Correlation Between BioNTech and SPECTRAL MEDICAL

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

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

Diversification Opportunities for BioNTech and SPECTRAL MEDICAL

-0.41

Correlation Coefficient

BioNTech  SPECTRAL MEDICAL

Very good diversification

The 3 months correlation between BioNTech and SPECTRAL is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding BioNTech SE and SPECTRAL MEDICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPECTRAL MEDICAL 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 SPECTRAL MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPECTRAL MEDICAL has no effect on the direction of BioNTech i.e., BioNTech and SPECTRAL MEDICAL go up and down completely randomly.

Pair Corralation between BioNTech and SPECTRAL MEDICAL

Assuming the 90 days trading horizon BioNTech SE is expected to under-perform the SPECTRAL MEDICAL. In addition to that, BioNTech is 1.4 times more volatile than SPECTRAL MEDICAL. It trades about -0.02 of its total potential returns per unit of risk. SPECTRAL MEDICAL is currently generating about 0.03 per unit of volatility. If you would invest  49.00  in SPECTRAL MEDICAL on April 23, 2025 and sell it today you would earn a total of  1.00  from holding SPECTRAL MEDICAL or generate 2.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

BioNTech SE  vs.  SPECTRAL MEDICAL

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 rather sound basic indicators, BioNTech is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

SPECTRAL MEDICAL

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SPECTRAL MEDICAL are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, SPECTRAL MEDICAL is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with BioNTech and SPECTRAL MEDICAL

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

The idea behind BioNTech SE and SPECTRAL MEDICAL 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.