Correlation Between Valneva SE and Critical Metals

Can any of the company-specific risk be diversified away by investing in both Valneva SE and Critical Metals 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 Critical Metals 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 Critical Metals Corp, you can compare the effects of market volatilities on Valneva SE and Critical Metals 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 Critical Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valneva SE and Critical Metals.

Diversification Opportunities for Valneva SE and Critical Metals

0.78

Correlation Coefficient

Valneva SE  Critical Metals

Poor diversification

The 3 months correlation between Valneva and Critical is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Valneva SE ADR and Critical Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Critical Metals Corp 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 Critical Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Critical Metals Corp has no effect on the direction of Valneva SE i.e., Valneva SE and Critical Metals go up and down completely randomly.

Pair Corralation between Valneva SE and Critical Metals

Given the investment horizon of 90 days Valneva SE is expected to generate 2.81 times less return on investment than Critical Metals. But when comparing it to its historical volatility, Valneva SE ADR is 2.53 times less risky than Critical Metals. It trades about 0.23 of its potential returns per unit of risk. Critical Metals Corp is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest  150.00  in Critical Metals Corp on May 25, 2025 and sell it today you would earn a total of  505.00  from holding Critical Metals Corp or generate 336.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Valneva SE ADR  vs.  Critical Metals Corp

Valneva SE ADR

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Valneva SE ADR are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile essential indicators, Valneva SE displayed solid returns over the last few months and may actually be approaching a breakup point.

Critical Metals Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Critical Metals Corp are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile primary indicators, Critical Metals disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Valneva SE and Critical Metals

The main advantage of trading using opposite Valneva SE and Critical Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Valneva SE position performs unexpectedly, Critical Metals 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 Critical Metals will offset losses from the drop in Critical Metals' long position.

The idea behind Valneva SE ADR and Critical Metals Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.