Correlation Between BioNTech and Vienna Insurance

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

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

Diversification Opportunities for BioNTech and Vienna Insurance

0.04

Correlation Coefficient

BioNTech  Vienna Insurance

Significant diversification

The 3 months correlation between BioNTech and Vienna is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding BioNTech SE and Vienna Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vienna Insurance 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 Vienna Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vienna Insurance has no effect on the direction of BioNTech i.e., BioNTech and Vienna Insurance go up and down completely randomly.

Pair Corralation between BioNTech and Vienna Insurance

Assuming the 90 days trading horizon BioNTech is expected to generate 45.05 times less return on investment than Vienna Insurance. In addition to that, BioNTech is 2.47 times more volatile than Vienna Insurance Group. It trades about 0.0 of its total potential returns per unit of risk. Vienna Insurance Group is currently generating about 0.2 per unit of volatility. If you would invest  2,940  in Vienna Insurance Group on October 8, 2024 and sell it today you would earn a total of  80.00  from holding Vienna Insurance Group or generate 2.72% return on investment over 90 days.

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

BioNTech SE  vs.  Vienna Insurance Group

BioNTech SE

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BioNTech SE are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, BioNTech is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Vienna Insurance

Risk-Adjusted Performance

9 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Vienna Insurance Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Vienna Insurance may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with BioNTech and Vienna Insurance

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

The idea behind BioNTech SE and Vienna Insurance Group 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.

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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..