Correlation Between BIONTECH and G2D Investments
Can any of the company-specific risk be diversified away by investing in both BIONTECH and G2D Investments 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 G2D Investments 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 G2D Investments, you can compare the effects of market volatilities on BIONTECH and G2D Investments 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 G2D Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of BIONTECH and G2D Investments.
Diversification Opportunities for BIONTECH and G2D Investments
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BIONTECH and G2D is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding BIONTECH SE DRN and G2D Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G2D Investments 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 G2D Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G2D Investments has no effect on the direction of BIONTECH i.e., BIONTECH and G2D Investments go up and down completely randomly.
Pair Corralation between BIONTECH and G2D Investments
Assuming the 90 days trading horizon BIONTECH SE DRN is expected to generate 1.2 times more return on investment than G2D Investments. However, BIONTECH is 1.2 times more volatile than G2D Investments. It trades about 0.12 of its potential returns per unit of risk. G2D Investments is currently generating about -0.01 per unit of risk. If you would invest 2,990 in BIONTECH SE DRN on September 13, 2024 and sell it today you would earn a total of 1,538 from holding BIONTECH SE DRN or generate 51.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BIONTECH SE DRN vs. G2D Investments
Performance |
| Timeline |
| BIONTECH SE DRN |
| G2D Investments |
BIONTECH and G2D Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BIONTECH and G2D Investments
The main advantage of trading using opposite BIONTECH and G2D Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BIONTECH position performs unexpectedly, G2D Investments 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 G2D Investments will offset losses from the drop in G2D Investments' long position.| BIONTECH vs. CVS Health | BIONTECH vs. Hospital Mater Dei | BIONTECH vs. Fidelity National Information | BIONTECH vs. UnitedHealth Group Incorporated |
| G2D Investments vs. Tres Tentos Agroindustrial | G2D Investments vs. Nordon Indstrias Metalrgicas | G2D Investments vs. Multilaser Industrial SA | G2D Investments vs. Palantir Technologies |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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