Correlation Between BNP Paribas and Nufarm
Can any of the company-specific risk be diversified away by investing in both BNP Paribas and Nufarm 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 BNP Paribas and Nufarm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BNP Paribas SA and Nufarm Limited, you can compare the effects of market volatilities on BNP Paribas and Nufarm 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 BNP Paribas with a short position of Nufarm. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNP Paribas and Nufarm.
Diversification Opportunities for BNP Paribas and Nufarm
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BNP and Nufarm is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BNP Paribas SA and Nufarm Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nufarm Limited and BNP Paribas 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 BNP Paribas SA are associated (or correlated) with Nufarm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nufarm Limited has no effect on the direction of BNP Paribas i.e., BNP Paribas and Nufarm go up and down completely randomly.
Pair Corralation between BNP Paribas and Nufarm
If you would invest 212.00 in Nufarm Limited on November 22, 2024 and sell it today you would earn a total of 12.00 from holding Nufarm Limited or generate 5.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 4.55% |
Values | Daily Returns |
BNP Paribas SA vs. Nufarm Limited
Performance |
Timeline |
BNP Paribas SA |
Risk-Adjusted Performance
Solid
Weak | Strong |
Nufarm Limited |
BNP Paribas and Nufarm Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with BNP Paribas and Nufarm
The main advantage of trading using opposite BNP Paribas and Nufarm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNP Paribas position performs unexpectedly, Nufarm 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 Nufarm will offset losses from the drop in Nufarm's long position.BNP Paribas vs. Retail Estates NV | BNP Paribas vs. Luckin Coffee | BNP Paribas vs. Eidesvik Offshore ASA | BNP Paribas vs. JIAHUA STORES |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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