Correlation Between Acco Brands and BioNTech

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Can any of the company-specific risk be diversified away by investing in both Acco Brands 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 Acco Brands and BioNTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acco Brands and BioNTech SE, you can compare the effects of market volatilities on Acco Brands 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 Acco Brands with a short position of BioNTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acco Brands and BioNTech.

Diversification Opportunities for Acco Brands and BioNTech

-0.14
  Correlation Coefficient

Good diversification

The 3 months correlation between Acco and BioNTech is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and BioNTech SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioNTech SE and Acco Brands 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 Acco Brands 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 Acco Brands i.e., Acco Brands and BioNTech go up and down completely randomly.

Pair Corralation between Acco Brands and BioNTech

Given the investment horizon of 90 days Acco Brands is expected to generate 0.9 times more return on investment than BioNTech. However, Acco Brands is 1.11 times less risky than BioNTech. It trades about 0.07 of its potential returns per unit of risk. BioNTech SE is currently generating about 0.01 per unit of risk. If you would invest  531.00  in Acco Brands on September 18, 2024 and sell it today you would earn a total of  50.00  from holding Acco Brands or generate 9.42% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Acco Brands  vs.  BioNTech SE

 Performance 
       Timeline  
Acco Brands 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Acco Brands are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Acco Brands may actually be approaching a critical reversion point that can send shares even higher in January 2025.
BioNTech SE 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
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.

Acco Brands and BioNTech Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Acco Brands and BioNTech

The main advantage of trading using opposite Acco Brands and BioNTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acco Brands 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 Acco Brands 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.

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