Correlation Between Moderna and Norsk Hydro
Can any of the company-specific risk be diversified away by investing in both Moderna and Norsk Hydro 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 Norsk Hydro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Moderna and Norsk Hydro ASA, you can compare the effects of market volatilities on Moderna and Norsk Hydro 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 Norsk Hydro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moderna and Norsk Hydro.
Diversification Opportunities for Moderna and Norsk Hydro
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Moderna and Norsk is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Moderna and Norsk Hydro ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Norsk Hydro ASA 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 Norsk Hydro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Norsk Hydro ASA has no effect on the direction of Moderna i.e., Moderna and Norsk Hydro go up and down completely randomly.
Pair Corralation between Moderna and Norsk Hydro
Assuming the 90 days horizon Moderna is expected to generate 3.25 times more return on investment than Norsk Hydro. However, Moderna is 3.25 times more volatile than Norsk Hydro ASA. It trades about 0.15 of its potential returns per unit of risk. Norsk Hydro ASA is currently generating about -0.56 per unit of risk. If you would invest 3,522 in Moderna on September 20, 2024 and sell it today you would earn a total of 378.00 from holding Moderna or generate 10.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Moderna vs. Norsk Hydro ASA
Performance |
| Timeline |
| Moderna |
| Norsk Hydro ASA |
Moderna and Norsk Hydro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Moderna and Norsk Hydro
The main advantage of trading using opposite Moderna and Norsk Hydro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moderna position performs unexpectedly, Norsk Hydro 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 Norsk Hydro will offset losses from the drop in Norsk Hydro's long position.| Moderna vs. Superior Plus Corp | Moderna vs. SIVERS SEMICONDUCTORS AB | Moderna vs. NorAm Drilling AS | Moderna vs. Norsk Hydro ASA |
| Norsk Hydro vs. NORWEGIAN AIR SHUT | Norsk Hydro vs. Seven West Media | Norsk Hydro vs. DELTA AIR LINES | Norsk Hydro vs. Westinghouse Air Brake |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |