Correlation Between Moderna and Alexion Pharmaceuticals

Can any of the company-specific risk be diversified away by investing in both Moderna and Alexion Pharmaceuticals 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 Alexion Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Moderna and Alexion Pharmaceuticals, you can compare the effects of market volatilities on Moderna and Alexion Pharmaceuticals 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 Alexion Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moderna and Alexion Pharmaceuticals.

Diversification Opportunities for Moderna and Alexion Pharmaceuticals

0.0

Correlation Coefficient

Moderna  Alexion Pharmaceuticals

Pay attention - limited upside

The 3 months correlation between Moderna and Alexion is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Moderna and Alexion Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alexion Pharmaceuticals 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 Alexion Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alexion Pharmaceuticals has no effect on the direction of Moderna i.e., Moderna and Alexion Pharmaceuticals go up and down completely randomly.

Pair Corralation between Moderna and Alexion Pharmaceuticals

If you would invest (100.00) in Alexion Pharmaceuticals on January 19, 2024 and sell it today you would earn a total of  100.00  from holding Alexion Pharmaceuticals or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Moderna  vs.  Alexion Pharmaceuticals

Moderna

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Moderna are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Moderna is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Alexion Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alexion Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Alexion Pharmaceuticals is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Moderna and Alexion Pharmaceuticals

The main advantage of trading using opposite Moderna and Alexion Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moderna position performs unexpectedly, Alexion Pharmaceuticals 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 Alexion Pharmaceuticals will offset losses from the drop in Alexion Pharmaceuticals' long position.

The idea behind Moderna and Alexion Pharmaceuticals 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 the Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..