Correlation Between BioNTech and Penta Ocean

Can any of the company-specific risk be diversified away by investing in both BioNTech and Penta Ocean 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 Penta Ocean into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BioNTech SE and Penta Ocean Construction Co, you can compare the effects of market volatilities on BioNTech and Penta Ocean 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 Penta Ocean. Check out your portfolio center. Please also check ongoing floating volatility patterns of BioNTech and Penta Ocean.

Diversification Opportunities for BioNTech and Penta Ocean

-0.62

Correlation Coefficient

BioNTech  Penta Ocean

Excellent diversification

The 3 months correlation between BioNTech and Penta is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding BioNTech SE and Penta Ocean Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penta Ocean Construc 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 Penta Ocean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penta Ocean Construc has no effect on the direction of BioNTech i.e., BioNTech and Penta Ocean go up and down completely randomly.

Pair Corralation between BioNTech and Penta Ocean

Assuming the 90 days trading horizon BioNTech SE is expected to under-perform the Penta Ocean. In addition to that, BioNTech is 1.08 times more volatile than Penta Ocean Construction Co. It trades about -0.15 of its total potential returns per unit of risk. Penta Ocean Construction Co is currently generating about 0.12 per unit of volatility. If you would invest  390.00  in Penta Ocean Construction Co on December 24, 2024 and sell it today you would earn a total of  56.00  from holding Penta Ocean Construction Co or generate 14.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

BioNTech SE  vs.  Penta Ocean Construction Co

BioNTech SE

Risk-Adjusted Performance

Very Weak

Over the last 90 days BioNTech SE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Penta Ocean Construc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Penta Ocean Construction Co are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Penta Ocean reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BioNTech and Penta Ocean

The main advantage of trading using opposite BioNTech and Penta Ocean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BioNTech position performs unexpectedly, Penta Ocean 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 Penta Ocean will offset losses from the drop in Penta Ocean's long position.

The idea behind BioNTech SE and Penta Ocean Construction Co 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.

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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.