Correlation Between BNP Paribas and KBC Group
Can any of the company-specific risk be diversified away by investing in both BNP Paribas and KBC Group 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 KBC Group 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 KBC Group NV, you can compare the effects of market volatilities on BNP Paribas and KBC Group 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 KBC Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNP Paribas and KBC Group.
Diversification Opportunities for BNP Paribas and KBC Group
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BNP and KBC is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding BNP Paribas SA and KBC Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KBC Group NV 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 KBC Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KBC Group NV has no effect on the direction of BNP Paribas i.e., BNP Paribas and KBC Group go up and down completely randomly.
Pair Corralation between BNP Paribas and KBC Group
Assuming the 90 days horizon BNP Paribas is expected to generate 3.7 times less return on investment than KBC Group. In addition to that, BNP Paribas is 1.38 times more volatile than KBC Group NV. It trades about 0.07 of its total potential returns per unit of risk. KBC Group NV is currently generating about 0.35 per unit of volatility. If you would invest 6,850 in KBC Group NV on September 27, 2024 and sell it today you would earn a total of 458.00 from holding KBC Group NV or generate 6.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BNP Paribas SA vs. KBC Group NV
Performance |
| Timeline |
| BNP Paribas SA |
| KBC Group NV |
BNP Paribas and KBC Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNP Paribas and KBC Group
The main advantage of trading using opposite BNP Paribas and KBC Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNP Paribas position performs unexpectedly, KBC Group 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 KBC Group will offset losses from the drop in KBC Group'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 |
| KBC Group vs. SERI INDUSTRIAL EO | KBC Group vs. GALENA MINING LTD | KBC Group vs. Evolution Mining Limited | KBC Group vs. CHINA SOUTHN AIR H |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |