Correlation Between Dana and BioNTech
Can any of the company-specific risk be diversified away by investing in both Dana 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 Dana and BioNTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dana Inc and BioNTech SE, you can compare the effects of market volatilities on Dana 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 Dana with a short position of BioNTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dana and BioNTech.
Diversification Opportunities for Dana and BioNTech
Average diversification
The 3 months correlation between Dana and BioNTech is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Dana Inc and BioNTech SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioNTech SE and Dana 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 Dana Inc 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 Dana i.e., Dana and BioNTech go up and down completely randomly.
Pair Corralation between Dana and BioNTech
Considering the 90-day investment horizon Dana Inc is expected to generate 0.85 times more return on investment than BioNTech. However, Dana Inc is 1.17 times less risky than BioNTech. It trades about 0.44 of its potential returns per unit of risk. BioNTech SE is currently generating about 0.13 per unit of risk. If you would invest 763.00 in Dana Inc on September 3, 2024 and sell it today you would earn a total of 237.00 from holding Dana Inc or generate 31.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dana Inc vs. BioNTech SE
Performance |
| Timeline |
| Dana Inc |
| BioNTech SE |
Dana and BioNTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dana and BioNTech
The main advantage of trading using opposite Dana and BioNTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dana 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.The idea behind Dana Inc and BioNTech SE 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.| BioNTech vs. Novavax | BioNTech vs. Ginkgo Bioworks Holdings | BioNTech vs. Crispr Therapeutics AG | BioNTech vs. Ocean Biomedical |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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