Correlation Between Criteo Sa and Valens
Can any of the company-specific risk be diversified away by investing in both Criteo Sa and Valens 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 Criteo Sa and Valens into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Criteo Sa and Valens, you can compare the effects of market volatilities on Criteo Sa and Valens 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 Criteo Sa with a short position of Valens. Check out your portfolio center. Please also check ongoing floating volatility patterns of Criteo Sa and Valens.
Diversification Opportunities for Criteo Sa and Valens
Significant diversification
The 3 months correlation between Criteo and Valens is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Criteo Sa and Valens in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valens and Criteo Sa 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 Criteo Sa are associated (or correlated) with Valens. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valens has no effect on the direction of Criteo Sa i.e., Criteo Sa and Valens go up and down completely randomly.
Pair Corralation between Criteo Sa and Valens
Given the investment horizon of 90 days Criteo Sa is expected to under-perform the Valens. But the stock apears to be less risky and, when comparing its historical volatility, Criteo Sa is 1.77 times less risky than Valens. The stock trades about -0.22 of its potential returns per unit of risk. The Valens is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 236.00 in Valens on April 23, 2025 and sell it today you would earn a total of 39.00 from holding Valens or generate 16.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Criteo Sa vs. Valens
Performance |
| Timeline |
| Criteo Sa |
| Valens |
Criteo Sa and Valens Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Criteo Sa and Valens
The main advantage of trading using opposite Criteo Sa and Valens positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Criteo Sa position performs unexpectedly, Valens 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 Valens will offset losses from the drop in Valens' long position.The idea behind Criteo Sa and Valens 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.| Valens vs. SolarEdge Technologies | Valens vs. First Solar | Valens vs. Sunrun Inc | Valens vs. Canadian Solar |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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