Correlation Between Hudson Technologies and BioNTech
Can any of the company-specific risk be diversified away by investing in both Hudson Technologies 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 Hudson Technologies and BioNTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hudson Technologies and BioNTech SE, you can compare the effects of market volatilities on Hudson Technologies 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 Hudson Technologies with a short position of BioNTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hudson Technologies and BioNTech.
Diversification Opportunities for Hudson Technologies and BioNTech
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hudson and BioNTech is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Hudson Technologies and BioNTech SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioNTech SE and Hudson Technologies 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 Hudson Technologies 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 Hudson Technologies i.e., Hudson Technologies and BioNTech go up and down completely randomly.
Pair Corralation between Hudson Technologies and BioNTech
Given the investment horizon of 90 days Hudson Technologies is expected to under-perform the BioNTech. In addition to that, Hudson Technologies is 1.01 times more volatile than BioNTech SE. It trades about -0.1 of its total potential returns per unit of risk. BioNTech SE is currently generating about 0.06 per unit of volatility. If you would invest 10,287 in BioNTech SE on August 30, 2024 and sell it today you would earn a total of 1,785 from holding BioNTech SE or generate 17.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hudson Technologies vs. BioNTech SE
Performance |
| Timeline |
| Hudson Technologies |
| BioNTech SE |
Hudson Technologies and BioNTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hudson Technologies and BioNTech
The main advantage of trading using opposite Hudson Technologies and BioNTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hudson Technologies 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.| Hudson Technologies vs. Sensient Technologies | Hudson Technologies vs. Innospec | Hudson Technologies vs. H B Fuller | Hudson Technologies vs. Quaker Chemical |
| BioNTech vs. Ikena Oncology | BioNTech vs. Eliem Therapeutics | BioNTech vs. HCW Biologics | BioNTech vs. Tempest Therapeutics |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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