Correlation Between Valneva SE and Coherus BioSciences
Can any of the company-specific risk be diversified away by investing in both Valneva SE and Coherus BioSciences at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Valneva SE and Coherus BioSciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Valneva SE ADR and Coherus BioSciences, you can compare the effects of market volatilities on Valneva SE and Coherus BioSciences and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Valneva SE with a short position of Coherus BioSciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and Coherus BioSciences.
Diversification Opportunities for Valneva SE and Coherus BioSciences
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Valneva and Coherus is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and Coherus BioSciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coherus BioSciences and Valneva SE is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Valneva SE ADR are associated (or correlated) with Coherus BioSciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coherus BioSciences has no effect on the direction of Valneva SE i.e., Valneva SE and Coherus BioSciences go up and down completely randomly.
Pair Corralation between Valneva SE and Coherus BioSciences
Given the investment horizon of 90 days Valneva SE ADR is expected to generate 0.51 times more return on investment than Coherus BioSciences. However, Valneva SE ADR is 1.96 times less risky than Coherus BioSciences. It trades about -0.28 of its potential returns per unit of risk. Coherus BioSciences is currently generating about -0.19 per unit of risk. If you would invest 792.00 in Valneva SE ADR on July 22, 2024 and sell it today you would lose (203.00) from holding Valneva SE ADR or give up 25.63% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Valneva SE ADR vs. Coherus BioSciences
Performance |
Timeline |
Valneva SE ADR |
Coherus BioSciences |
Valneva SE and Coherus BioSciences Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Valneva SE and Coherus BioSciences
The main advantage of trading using opposite Valneva SE and Coherus BioSciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, Coherus BioSciences can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Coherus BioSciences will offset losses from the drop in Coherus BioSciences' long position.Valneva SE vs. NuCana PLC | Valneva SE vs. Sage Therapeutic | Valneva SE vs. Sellas Life Sciences | Valneva SE vs. Third Harmonic Bio |
Coherus BioSciences vs. Agilent Technologies | Coherus BioSciences vs. 23Andme Holding Co | Coherus BioSciences vs. DiaMedica Therapeutics | Coherus BioSciences vs. Valneva SE ADR |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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