Correlation Between Asure Software and BioNTech

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

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

Diversification Opportunities for Asure Software and BioNTech

0.04

Correlation Coefficient

Asure Software  BioNTech

Significant diversification

The 3 months correlation between Asure and BioNTech is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and BioNTech SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioNTech SE and Asure Software 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 Asure Software 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 Asure Software i.e., Asure Software and BioNTech go up and down completely randomly.

Pair Corralation between Asure Software and BioNTech

Given the investment horizon of 90 days Asure Software is expected to generate 2.48 times less return on investment than BioNTech. But when comparing it to its historical volatility, Asure Software is 1.13 times less risky than BioNTech. It trades about 0.05 of its potential returns per unit of risk. BioNTech SE is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  7,876  in BioNTech SE on September 30, 2024 and sell it today you would earn a total of  3,519  from holding BioNTech SE or generate 44.68% return on investment over 90 days.

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

Asure Software  vs.  BioNTech SE

Asure Software

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Asure Software are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile basic indicators, Asure Software 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

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.

Pair Trading with Asure Software and BioNTech

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

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.