Correlation Between Moderna and Ballard Power
Can any of the company-specific risk be diversified away by investing in both Moderna and Ballard Power 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 Ballard Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Moderna and Ballard Power Systems, you can compare the effects of market volatilities on Moderna and Ballard Power 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 Ballard Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moderna and Ballard Power.
Diversification Opportunities for Moderna and Ballard Power
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Moderna and Ballard is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Moderna and Ballard Power Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ballard Power Systems 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 Ballard Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ballard Power Systems has no effect on the direction of Moderna i.e., Moderna and Ballard Power go up and down completely randomly.
Pair Corralation between Moderna and Ballard Power
Assuming the 90 days horizon Moderna is expected to under-perform the Ballard Power. But the stock apears to be less risky and, when comparing its historical volatility, Moderna is 1.04 times less risky than Ballard Power. The stock trades about -0.06 of its potential returns per unit of risk. The Ballard Power Systems is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 532.00 in Ballard Power Systems on September 1, 2024 and sell it today you would lose (391.00) from holding Ballard Power Systems or give up 73.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Moderna vs. Ballard Power Systems
Performance |
| Timeline |
| Moderna |
| Ballard Power Systems |
Moderna and Ballard Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Moderna and Ballard Power
The main advantage of trading using opposite Moderna and Ballard Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moderna position performs unexpectedly, Ballard Power 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 Ballard Power will offset losses from the drop in Ballard Power's long position.| Moderna vs. Superior Plus Corp | Moderna vs. NMI Holdings | Moderna vs. Origin Agritech | Moderna vs. SIVERS SEMICONDUCTORS AB |
| Ballard Power vs. Powercell Sweden | Ballard Power vs. Nel ASA | Ballard Power vs. ITM Power Plc | Ballard Power vs. Plug Power |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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