Correlation Between Celestica and CureVac NV

Can any of the company-specific risk be diversified away by investing in both Celestica and CureVac NV 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 Celestica and CureVac NV into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Celestica and CureVac NV, you can compare the effects of market volatilities on Celestica and CureVac NV 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 Celestica with a short position of CureVac NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celestica and CureVac NV.

Diversification Opportunities for Celestica and CureVac NV

0.43

Correlation Coefficient

Celestica  CureVac NV

Very weak diversification

The 3 months correlation between Celestica and CureVac is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Celestica and CureVac NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CureVac NV and Celestica 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 Celestica are associated (or correlated) with CureVac NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CureVac NV has no effect on the direction of Celestica i.e., Celestica and CureVac NV go up and down completely randomly.

Pair Corralation between Celestica and CureVac NV

Considering the 90-day investment horizon Celestica is expected to generate 1.98 times less return on investment than CureVac NV. But when comparing it to its historical volatility, Celestica is 2.26 times less risky than CureVac NV. It trades about 0.26 of its potential returns per unit of risk. CureVac NV is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  321.00  in CureVac NV on October 11, 2024 and sell it today you would earn a total of  102.00  from holding CureVac NV or generate 31.78% return on investment over 90 days.

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

Celestica  vs.  CureVac NV

Celestica

Risk-Adjusted Performance

18 of 100

Solid

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

CureVac NV

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CureVac NV are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, CureVac NV exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Celestica and CureVac NV

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

The idea behind Celestica and CureVac NV 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.

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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.