Correlation Between BioNTech and TMT Acquisition

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

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

Diversification Opportunities for BioNTech and TMT Acquisition

0.0

Correlation Coefficient

BioNTech  TMT Acquisition

Pay attention - limited upside

The 3 months correlation between BioNTech and TMT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BioNTech SE and TMT Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TMT Acquisition Corp 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 TMT Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TMT Acquisition Corp has no effect on the direction of BioNTech i.e., BioNTech and TMT Acquisition go up and down completely randomly.

Pair Corralation between BioNTech and TMT Acquisition

If you would invest (100.00) in TMT Acquisition Corp on December 20, 2024 and sell it today you would earn a total of  100.00  from holding TMT Acquisition Corp or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

BioNTech SE  vs.  TMT Acquisition Corp

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 latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

TMT Acquisition Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days TMT Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, TMT Acquisition is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with BioNTech and TMT Acquisition

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

The idea behind BioNTech SE and TMT Acquisition Corp 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 Transaction History module to view history of all your transactions and understand their impact on performance.