Correlation Between Mindflair Plc and BioNTech

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

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

Diversification Opportunities for Mindflair Plc and BioNTech

-0.16

Correlation Coefficient

Mindflair Plc  BioNTech

Good diversification

The 3 months correlation between Mindflair and BioNTech is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Mindflair Plc and BioNTech SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioNTech SE and Mindflair Plc 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 Mindflair Plc 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 Mindflair Plc i.e., Mindflair Plc and BioNTech go up and down completely randomly.

Pair Corralation between Mindflair Plc and BioNTech

Assuming the 90 days trading horizon Mindflair Plc is expected to under-perform the BioNTech. But the stock apears to be less risky and, when comparing its historical volatility, Mindflair Plc is 1.24 times less risky than BioNTech. The stock trades about -0.17 of its potential returns per unit of risk. The BioNTech SE is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  8,800  in BioNTech SE on October 3, 2024 and sell it today you would earn a total of  2,430  from holding BioNTech SE or generate 27.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.82%
Values	Daily Returns

Mindflair Plc  vs.  BioNTech SE

Mindflair Plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mindflair Plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

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. Despite quite persistent essential indicators, BioNTech is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Mindflair Plc and BioNTech

The main advantage of trading using opposite Mindflair Plc and BioNTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mindflair Plc 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.

The idea behind Mindflair Plc and BioNTech SE 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.