Correlation Between Moderna and CureVac NV

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

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

Diversification Opportunities for Moderna and CureVac NV

0.45

Correlation Coefficient

Moderna  CureVac NV

Very weak diversification

The 3 months correlation between Moderna and CureVac is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Moderna and CureVac NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CureVac NV and Moderna 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 Moderna 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 Moderna i.e., Moderna and CureVac NV go up and down completely randomly.

Pair Corralation between Moderna and CureVac NV

Given the investment horizon of 90 days Moderna is expected to under-perform the CureVac NV. In addition to that, Moderna is 1.14 times more volatile than CureVac NV. It trades about -0.04 of its total potential returns per unit of risk. CureVac NV is currently generating about -0.02 per unit of volatility. If you would invest  312.00  in CureVac NV on December 29, 2024 and sell it today you would lose (32.00) from holding CureVac NV or give up 10.26% of portfolio value over 90 days.

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

Moderna  vs.  CureVac NV

Moderna

Risk-Adjusted Performance

Very Weak

Over the last 90 days Moderna has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

CureVac NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days CureVac NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, CureVac NV is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Moderna and CureVac NV

The main advantage of trading using opposite Moderna and CureVac NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moderna 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 Moderna 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.