Correlation Between Sphere Entertainment and CureVac NV

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

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

Diversification Opportunities for Sphere Entertainment and CureVac NV

0.59

Correlation Coefficient

Sphere Entertainment  CureVac NV

Very weak diversification

The 3 months correlation between Sphere and CureVac is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Sphere Entertainment Co and CureVac NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CureVac NV and Sphere Entertainment 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 Sphere Entertainment Co 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 Sphere Entertainment i.e., Sphere Entertainment and CureVac NV go up and down completely randomly.

Pair Corralation between Sphere Entertainment and CureVac NV

Given the investment horizon of 90 days Sphere Entertainment Co is expected to under-perform the CureVac NV. But the stock apears to be less risky and, when comparing its historical volatility, Sphere Entertainment Co is 1.6 times less risky than CureVac NV. The stock trades about -0.09 of its potential returns per unit of risk. The CureVac NV is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  312.00  in CureVac NV on December 28, 2024 and sell it today you would lose (14.00) from holding CureVac NV or give up 4.49% of portfolio value over 90 days.

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

Sphere Entertainment Co  vs.  CureVac NV

Sphere Entertainment

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sphere Entertainment Co has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's technical indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail 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 latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Sphere Entertainment and CureVac NV

The main advantage of trading using opposite Sphere Entertainment and CureVac NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sphere Entertainment 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 Sphere Entertainment Co 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.