Correlation Between Healthpeak Properties and Moderna

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

By analyzing existing cross correlation between Healthpeak Properties and Moderna, you can compare the effects of market volatilities on Healthpeak Properties 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 Healthpeak Properties with a short position of Moderna. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthpeak Properties and Moderna.

Diversification Opportunities for Healthpeak Properties and Moderna

-0.77

Correlation Coefficient

Healthpeak Properties  Moderna

Pay attention - limited upside

The 3 months correlation between Healthpeak and Moderna is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Healthpeak Properties and Moderna in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moderna and Healthpeak Properties 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 Healthpeak Properties 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 Healthpeak Properties i.e., Healthpeak Properties and Moderna go up and down completely randomly.

Pair Corralation between Healthpeak Properties and Moderna

Assuming the 90 days trading horizon Healthpeak Properties is expected to under-perform the Moderna. But the stock apears to be less risky and, when comparing its historical volatility, Healthpeak Properties is 1.98 times less risky than Moderna. The stock trades about -0.22 of its potential returns per unit of risk. The Moderna is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  1,241  in Moderna on September 27, 2024 and sell it today you would lose (31.00) from holding Moderna or give up 2.5% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Healthpeak Properties  vs.  Moderna

Healthpeak Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Healthpeak Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Healthpeak Properties is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Moderna

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Moderna has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Healthpeak Properties and Moderna

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

The idea behind Healthpeak Properties 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.

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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.