Correlation Between BioNTech and Induction Healthcare
Can any of the company-specific risk be diversified away by investing in both BioNTech and Induction Healthcare 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 BioNTech and Induction Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BioNTech SE and Induction Healthcare Group, you can compare the effects of market volatilities on BioNTech and Induction Healthcare 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 BioNTech with a short position of Induction Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioNTech and Induction Healthcare.
Diversification Opportunities for BioNTech and Induction Healthcare
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BioNTech and Induction is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding BioNTech SE and Induction Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Induction Healthcare and BioNTech 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 BioNTech SE are associated (or correlated) with Induction Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Induction Healthcare has no effect on the direction of BioNTech i.e., BioNTech and Induction Healthcare go up and down completely randomly.
Pair Corralation between BioNTech and Induction Healthcare
Assuming the 90 days trading horizon BioNTech is expected to generate 1.1 times less return on investment than Induction Healthcare. In addition to that, BioNTech is 1.18 times more volatile than Induction Healthcare Group. It trades about 0.07 of its total potential returns per unit of risk. Induction Healthcare Group is currently generating about 0.09 per unit of volatility. If you would invest 850.00 in Induction Healthcare Group on August 31, 2024 and sell it today you would earn a total of 50.00 from holding Induction Healthcare Group or generate 5.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
BioNTech SE vs. Induction Healthcare Group
Performance |
| Timeline |
| BioNTech SE |
| Induction Healthcare |
BioNTech and Induction Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioNTech and Induction Healthcare
The main advantage of trading using opposite BioNTech and Induction Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioNTech position performs unexpectedly, Induction Healthcare 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 Induction Healthcare will offset losses from the drop in Induction Healthcare's long position.| BioNTech vs. National Bank of | BioNTech vs. Infrastrutture Wireless Italiane | BioNTech vs. Adriatic Metals | BioNTech vs. Jacquet Metal Service |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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