Correlation Between COSCO SHIPPING and Moderna

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Can any of the company-specific risk be diversified away by investing in both COSCO SHIPPING 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 COSCO SHIPPING and Moderna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COSCO SHIPPING HOLDINGS and Moderna, you can compare the effects of market volatilities on COSCO SHIPPING 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 COSCO SHIPPING with a short position of Moderna. Check out your portfolio center. Please also check ongoing floating volatility patterns of COSCO SHIPPING and Moderna.

Diversification Opportunities for COSCO SHIPPING and Moderna

0.73
  Correlation Coefficient

Poor diversification

The 3 months correlation between COSCO and Moderna is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding COSCO SHIPPING HOLDINGS and Moderna in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moderna and COSCO SHIPPING 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 COSCO SHIPPING HOLDINGS 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 COSCO SHIPPING i.e., COSCO SHIPPING and Moderna go up and down completely randomly.

Pair Corralation between COSCO SHIPPING and Moderna

Assuming the 90 days trading horizon COSCO SHIPPING HOLDINGS is expected to under-perform the Moderna. But the stock apears to be less risky and, when comparing its historical volatility, COSCO SHIPPING HOLDINGS is 1.97 times less risky than Moderna. The stock trades about -0.19 of its potential returns per unit of risk. The Moderna is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  14,000  in Moderna on April 6, 2022 and sell it today you would earn a total of  995.00  from holding Moderna or generate 7.11% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy85.0%
ValuesDaily Returns

COSCO SHIPPING HOLDINGS  vs.  Moderna

 Performance (%) 
      Timeline 
COSCO SHIPPING HOLDINGS 
COSCO Performance
0 of 100
Over the last 90 days COSCO SHIPPING HOLDINGS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, COSCO SHIPPING is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

COSCO Price Channel

Moderna 
Moderna Performance
0 of 100
Over the last 90 days Moderna has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Moderna is not utilizing all of its potentials. The new stock price disturbance, may contribute to short-term losses for the investors.

Moderna Price Channel

COSCO SHIPPING and Moderna Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with COSCO SHIPPING and Moderna

The main advantage of trading using opposite COSCO SHIPPING and Moderna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COSCO SHIPPING 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.

COSCO SHIPPING HOLDINGS

Pair trading matchups for COSCO SHIPPING

The idea behind COSCO SHIPPING HOLDINGS and Moderna 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.
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.

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