Correlation Between Joint Stock and BioNTech
Can any of the company-specific risk be diversified away by investing in both Joint Stock 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 Joint Stock and BioNTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Joint Stock and BioNTech SE, you can compare the effects of market volatilities on Joint Stock 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 Joint Stock with a short position of BioNTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Joint Stock and BioNTech.
Diversification Opportunities for Joint Stock and BioNTech
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Joint and BioNTech is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Joint Stock and BioNTech SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioNTech SE and Joint Stock 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 Joint Stock 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 Joint Stock i.e., Joint Stock and BioNTech go up and down completely randomly.
Pair Corralation between Joint Stock and BioNTech
Given the investment horizon of 90 days Joint Stock is expected to under-perform the BioNTech. But the stock apears to be less risky and, when comparing its historical volatility, Joint Stock is 1.13 times less risky than BioNTech. The stock trades about -0.01 of its potential returns per unit of risk. The BioNTech SE is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 8,931 in BioNTech SE on September 3, 2024 and sell it today you would earn a total of 2,908 from holding BioNTech SE or generate 32.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Joint Stock vs. BioNTech SE
Performance |
| Timeline |
| Joint Stock |
| BioNTech SE |
Joint Stock and BioNTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Joint Stock and BioNTech
The main advantage of trading using opposite Joint Stock and BioNTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Joint Stock 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.| Joint Stock vs. Microbot Medical | Joint Stock vs. Pearson PLC ADR | Joint Stock vs. HNI Corp | Joint Stock vs. Franklin Wireless Corp |
| 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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