Correlation Between BIONTECH and BeiGene
Can any of the company-specific risk be diversified away by investing in both BIONTECH and BeiGene 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 BeiGene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BIONTECH SE DRN and BeiGene, you can compare the effects of market volatilities on BIONTECH and BeiGene 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 BeiGene. Check out your portfolio center. Please also check ongoing floating volatility patterns of BIONTECH and BeiGene.
Diversification Opportunities for BIONTECH and BeiGene
Very weak diversification
The 3 months correlation between BIONTECH and BeiGene is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding BIONTECH SE DRN and BeiGene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BeiGene 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 DRN are associated (or correlated) with BeiGene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BeiGene has no effect on the direction of BIONTECH i.e., BIONTECH and BeiGene go up and down completely randomly.
Pair Corralation between BIONTECH and BeiGene
Assuming the 90 days trading horizon BIONTECH is expected to generate 1.63 times less return on investment than BeiGene. In addition to that, BIONTECH is 1.1 times more volatile than BeiGene. It trades about 0.09 of its total potential returns per unit of risk. BeiGene is currently generating about 0.16 per unit of volatility. If you would invest 3,080 in BeiGene on August 31, 2024 and sell it today you would earn a total of 2,056 from holding BeiGene or generate 66.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BIONTECH SE DRN vs. BeiGene
Performance |
| Timeline |
| BIONTECH SE DRN |
| BeiGene |
BIONTECH and BeiGene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BIONTECH and BeiGene
The main advantage of trading using opposite BIONTECH and BeiGene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BIONTECH position performs unexpectedly, BeiGene 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 BeiGene will offset losses from the drop in BeiGene's long position.| BIONTECH vs. Fras le SA | BIONTECH vs. Western Digital | BIONTECH vs. Energisa SA | BIONTECH vs. Clave Indices De |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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