Correlation Between EON SE and Moderna

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

Diversification Opportunities for EON SE and Moderna

0.78
  Correlation Coefficient

Poor diversification

The 3 months correlation between EONGY and Moderna is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding EON SE ADR and Moderna in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moderna and EON SE 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 EON SE ADR 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 EON SE i.e., EON SE and Moderna go up and down completely randomly.

Pair Corralation between EON SE and Moderna

Assuming the 90 days horizon EON SE is expected to generate 1.31 times less return on investment than Moderna. But when comparing it to its historical volatility, EON SE ADR is 1.62 times less risky than Moderna. It trades about 0.36 of its potential returns per unit of risk. Moderna is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest  15,462  in Moderna on September 2, 2022 and sell it today you would earn a total of  2,686  from holding Moderna or generate 17.37% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy95.45%
ValuesDaily Returns

EON SE ADR  vs.  Moderna

 Performance (%) 
       Timeline  
EON SE ADR 
EONGY Performance
6 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in EON SE ADR are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain technical and fundamental indicators, EON SE may actually be approaching a critical reversion point that can send shares even higher in January 2023.

EONGY Price Channel

Moderna 
Moderna Performance
10 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Moderna are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Moderna sustained solid returns over the last few months and may actually be approaching a breakup point.

Moderna Price Channel

EON SE and Moderna Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with EON SE and Moderna

The main advantage of trading using opposite EON SE and Moderna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EON SE 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.
EON SE vs. Walmart
The idea behind EON SE ADR 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.
Moderna vs. Microsoft
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.

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