Correlation Between BioNTech and Identiv
Can any of the company-specific risk be diversified away by investing in both BioNTech and Identiv 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 Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BioNTech SE and Identiv, you can compare the effects of market volatilities on BioNTech and Identiv 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 Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioNTech and Identiv.
Diversification Opportunities for BioNTech and Identiv
Very weak diversification
The 3 months correlation between BioNTech and Identiv is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding BioNTech SE and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv 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 Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of BioNTech i.e., BioNTech and Identiv go up and down completely randomly.
Pair Corralation between BioNTech and Identiv
Assuming the 90 days trading horizon BioNTech is expected to generate 1.13 times less return on investment than Identiv. In addition to that, BioNTech is 1.12 times more volatile than Identiv. It trades about 0.13 of its total potential returns per unit of risk. Identiv is currently generating about 0.16 per unit of volatility. If you would invest 325.00 in Identiv on September 4, 2024 and sell it today you would earn a total of 35.00 from holding Identiv or generate 10.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
BioNTech SE vs. Identiv
Performance |
| Timeline |
| BioNTech SE |
| Identiv |
BioNTech and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioNTech and Identiv
The main advantage of trading using opposite BioNTech and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioNTech position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.The idea behind BioNTech SE and Identiv 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.| Identiv vs. SEALED AIR | Identiv vs. WIZZ AIR HLDGUNSPADR4 | Identiv vs. Alaska Air Group | Identiv vs. FORWARD AIR P |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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