Correlation Between BioNTech and Nabors Energy
Can any of the company-specific risk be diversified away by investing in both BioNTech and Nabors Energy 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 Nabors Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BioNTech SE and Nabors Energy Transition, you can compare the effects of market volatilities on BioNTech and Nabors Energy 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 Nabors Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioNTech and Nabors Energy.
Diversification Opportunities for BioNTech and Nabors Energy
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BioNTech and Nabors is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding BioNTech SE and Nabors Energy Transition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nabors Energy Transition 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 Nabors Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nabors Energy Transition has no effect on the direction of BioNTech i.e., BioNTech and Nabors Energy go up and down completely randomly.
Pair Corralation between BioNTech and Nabors Energy
Given the investment horizon of 90 days BioNTech SE is expected to generate 12.19 times more return on investment than Nabors Energy. However, BioNTech is 12.19 times more volatile than Nabors Energy Transition. It trades about 0.1 of its potential returns per unit of risk. Nabors Energy Transition is currently generating about 0.07 per unit of risk. If you would invest 10,664 in BioNTech SE on November 6, 2024 and sell it today you would earn a total of 1,713 from holding BioNTech SE or generate 16.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
BioNTech SE vs. Nabors Energy Transition
Performance |
| Timeline |
| BioNTech SE |
| Nabors Energy Transition |
BioNTech and Nabors Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BioNTech and Nabors Energy
The main advantage of trading using opposite BioNTech and Nabors Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioNTech position performs unexpectedly, Nabors Energy 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 Nabors Energy will offset losses from the drop in Nabors Energy's long position.| BioNTech vs. Novavax | BioNTech vs. Ginkgo Bioworks Holdings | BioNTech vs. Crispr Therapeutics AG | BioNTech vs. Ocean Biomedical |
| Nabors Energy vs. Helmerich and Payne | Nabors Energy vs. Summit Therapeutics PLC | Nabors Energy vs. Drilling Tools International | Nabors Energy vs. Borr Drilling |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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