Correlation Between Diamyd Medical and Moderna
Can any of the company-specific risk be diversified away by investing in both Diamyd Medical and Moderna 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 Diamyd Medical and Moderna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Diamyd Medical AB and Moderna, you can compare the effects of market volatilities on Diamyd Medical and Moderna 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 Diamyd Medical with a short position of Moderna. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamyd Medical and Moderna.
Diversification Opportunities for Diamyd Medical and Moderna
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Diamyd and Moderna is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Diamyd Medical AB and Moderna in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moderna and Diamyd Medical 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 Diamyd Medical AB are associated (or correlated) with Moderna. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moderna has no effect on the direction of Diamyd Medical i.e., Diamyd Medical and Moderna go up and down completely randomly.
Pair Corralation between Diamyd Medical and Moderna
Assuming the 90 days horizon Diamyd Medical AB is expected to generate 1.34 times more return on investment than Moderna. However, Diamyd Medical is 1.34 times more volatile than Moderna. It trades about 0.21 of its potential returns per unit of risk. Moderna is currently generating about -0.01 per unit of risk. If you would invest 108.00 in Diamyd Medical AB on September 13, 2024 and sell it today you would earn a total of 26.00 from holding Diamyd Medical AB or generate 24.07% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Diamyd Medical AB vs. Moderna
Performance |
Timeline |
Diamyd Medical AB |
Moderna |
Diamyd Medical and Moderna Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Diamyd Medical and Moderna
The main advantage of trading using opposite Diamyd Medical and Moderna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diamyd Medical position performs unexpectedly, Moderna 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 Moderna will offset losses from the drop in Moderna's long position.Diamyd Medical vs. Moderna | Diamyd Medical vs. BioNTech SE | Diamyd Medical vs. Superior Plus Corp | Diamyd Medical vs. SIVERS SEMICONDUCTORS AB |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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