Correlation Between CompuGroup Medical and BioNTech
Can any of the company-specific risk be diversified away by investing in both CompuGroup Medical and BioNTech 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 CompuGroup Medical and BioNTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CompuGroup Medical AG and BioNTech SE, you can compare the effects of market volatilities on CompuGroup Medical and BioNTech 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 CompuGroup Medical with a short position of BioNTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompuGroup Medical and BioNTech.
Diversification Opportunities for CompuGroup Medical and BioNTech
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CompuGroup and BioNTech is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding CompuGroup Medical AG and BioNTech SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioNTech SE and CompuGroup Medical 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 CompuGroup Medical AG are associated (or correlated) with BioNTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioNTech SE has no effect on the direction of CompuGroup Medical i.e., CompuGroup Medical and BioNTech go up and down completely randomly.
Pair Corralation between CompuGroup Medical and BioNTech
Assuming the 90 days trading horizon CompuGroup Medical AG is expected to under-perform the BioNTech. But the stock apears to be less risky and, when comparing its historical volatility, CompuGroup Medical AG is 1.05 times less risky than BioNTech. The stock trades about -0.05 of its potential returns per unit of risk. The BioNTech SE is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 17,978 in BioNTech SE on September 13, 2024 and sell it today you would lose (6,063) from holding BioNTech SE or give up 33.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.42% |
| Values | Daily Returns |
CompuGroup Medical AG vs. BioNTech SE
Performance |
| Timeline |
| CompuGroup Medical |
| BioNTech SE |
CompuGroup Medical and BioNTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompuGroup Medical and BioNTech
The main advantage of trading using opposite CompuGroup Medical and BioNTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompuGroup Medical position performs unexpectedly, BioNTech 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 BioNTech will offset losses from the drop in BioNTech's long position.| CompuGroup Medical vs. Fevertree Drinks Plc | CompuGroup Medical vs. Datalogic | CompuGroup Medical vs. National Beverage Corp | CompuGroup Medical vs. Scandic Hotels Group |
| BioNTech vs. Beowulf Mining | BioNTech vs. CompuGroup Medical AG | BioNTech vs. Eastinco Mining Exploration | BioNTech vs. Endeavour Mining Corp |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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