Correlation Between Moderna and Atreca

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

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

Diversification Opportunities for Moderna and Atreca

-0.2

Correlation Coefficient

Moderna  Atreca

Good diversification

The 3 months correlation between Moderna and Atreca is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Moderna and Atreca Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atreca Inc 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 Atreca. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atreca Inc has no effect on the direction of Moderna i.e., Moderna and Atreca go up and down completely randomly.

Pair Corralation between Moderna and Atreca

Given the investment horizon of 90 days Moderna is expected to generate 0.23 times more return on investment than Atreca. However, Moderna is 4.3 times less risky than Atreca. It trades about -0.01 of its potential returns per unit of risk. Atreca Inc is currently generating about -0.04 per unit of risk. If you would invest  12,300  in Moderna on January 24, 2024 and sell it today you would lose (1,854) from holding Moderna or give up 15.07% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	91.26%
Values	Daily Returns

Moderna  vs.  Atreca Inc

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 unsteady basic indicators, Moderna may actually be approaching a critical reversion point that can send shares even higher in May 2024.

Atreca Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Atreca Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in May 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Moderna and Atreca

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

The idea behind Moderna and Atreca Inc 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.

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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.