Correlation Between BNP Paribas and Intesa Sanpaolo
Can any of the company-specific risk be diversified away by investing in both BNP Paribas and Intesa Sanpaolo 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 Intesa Sanpaolo 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 Intesa Sanpaolo SpA, you can compare the effects of market volatilities on BNP Paribas and Intesa Sanpaolo 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 Intesa Sanpaolo. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNP Paribas and Intesa Sanpaolo.
Diversification Opportunities for BNP Paribas and Intesa Sanpaolo
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between BNP and Intesa is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding BNP Paribas SA and Intesa Sanpaolo SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intesa Sanpaolo SpA 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 Intesa Sanpaolo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intesa Sanpaolo SpA has no effect on the direction of BNP Paribas i.e., BNP Paribas and Intesa Sanpaolo go up and down completely randomly.
Pair Corralation between BNP Paribas and Intesa Sanpaolo
Assuming the 90 days horizon BNP Paribas is expected to generate 17.24 times less return on investment than Intesa Sanpaolo. In addition to that, BNP Paribas is 1.08 times more volatile than Intesa Sanpaolo SpA. It trades about 0.01 of its total potential returns per unit of risk. Intesa Sanpaolo SpA is currently generating about 0.23 per unit of volatility. If you would invest 361.00 in Intesa Sanpaolo SpA on September 25, 2024 and sell it today you would earn a total of 21.00 from holding Intesa Sanpaolo SpA or generate 5.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BNP Paribas SA vs. Intesa Sanpaolo SpA
Performance |
| Timeline |
| BNP Paribas SA |
| Intesa Sanpaolo SpA |
BNP Paribas and Intesa Sanpaolo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNP Paribas and Intesa Sanpaolo
The main advantage of trading using opposite BNP Paribas and Intesa Sanpaolo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNP Paribas position performs unexpectedly, Intesa Sanpaolo 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 Intesa Sanpaolo will offset losses from the drop in Intesa Sanpaolo's long position.| BNP Paribas vs. BNP PARIBAS ADR | BNP Paribas vs. Intesa Sanpaolo SpA | BNP Paribas vs. Lloyds Banking Group | BNP Paribas vs. Lloyds Banking Group |
| Intesa Sanpaolo vs. BNP Paribas SA | Intesa Sanpaolo vs. BNP PARIBAS ADR | Intesa Sanpaolo vs. Lloyds Banking Group | Intesa Sanpaolo vs. Lloyds Banking Group |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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