Correlation Between Vir Biotechnology and CureVac NV
Can any of the company-specific risk be diversified away by investing in both Vir Biotechnology 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 Vir Biotechnology and CureVac NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vir Biotechnology and CureVac NV, you can compare the effects of market volatilities on Vir Biotechnology 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 Vir Biotechnology with a short position of CureVac NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vir Biotechnology and CureVac NV.
Diversification Opportunities for Vir Biotechnology and CureVac NV
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Vir and CureVac is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Vir Biotechnology and CureVac NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CureVac NV and Vir Biotechnology 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 Vir Biotechnology 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 Vir Biotechnology i.e., Vir Biotechnology and CureVac NV go up and down completely randomly.
Pair Corralation between Vir Biotechnology and CureVac NV
Considering the 90-day investment horizon Vir Biotechnology is expected to generate 1.15 times more return on investment than CureVac NV. However, Vir Biotechnology is 1.15 times more volatile than CureVac NV. It trades about -0.02 of its potential returns per unit of risk. CureVac NV is currently generating about -0.02 per unit of risk. If you would invest 2,618 in Vir Biotechnology on November 2, 2024 and sell it today you would lose (1,587) from holding Vir Biotechnology or give up 60.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vir Biotechnology vs. CureVac NV
Performance |
| Timeline |
| Vir Biotechnology |
| CureVac NV |
Vir Biotechnology and CureVac NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vir Biotechnology and CureVac NV
The main advantage of trading using opposite Vir Biotechnology and CureVac NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vir Biotechnology 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.| Vir Biotechnology vs. CureVac NV | Vir Biotechnology vs. Krystal Biotech | Vir Biotechnology vs. Propanc Biopharma | Vir Biotechnology vs. Blueprint Medicines Corp |
| CureVac NV vs. Teleflex Incorporated | CureVac NV vs. Aperture Health | CureVac NV vs. AMCON Distributing | CureVac NV vs. Viemed Healthcare |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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