Correlation Between BioNTech and Celsius Holdings

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

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

Diversification Opportunities for BioNTech and Celsius Holdings

0.43

Correlation Coefficient

BioNTech  Celsius Holdings

Very weak diversification

The 3 months correlation between BioNTech and Celsius is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding BioNTech SE and Celsius Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celsius Holdings 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 Celsius Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celsius Holdings has no effect on the direction of BioNTech i.e., BioNTech and Celsius Holdings go up and down completely randomly.

Pair Corralation between BioNTech and Celsius Holdings

Given the investment horizon of 90 days BioNTech is expected to generate 1.57 times less return on investment than Celsius Holdings. But when comparing it to its historical volatility, BioNTech SE is 1.13 times less risky than Celsius Holdings. It trades about 0.19 of its potential returns per unit of risk. Celsius Holdings is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest  2,579  in Celsius Holdings on September 18, 2024 and sell it today you would earn a total of  515.00  from holding Celsius Holdings or generate 19.97% return on investment over 90 days.

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

BioNTech SE  vs.  Celsius Holdings

BioNTech SE

Risk-Adjusted Performance

0 of 100

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 fairly strong basic indicators, BioNTech is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Celsius Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Celsius Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong essential indicators, Celsius Holdings is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with BioNTech and Celsius Holdings

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

The idea behind BioNTech SE and Celsius Holdings 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.