Correlation Between BNP Paribas and Enter Air
Can any of the company-specific risk be diversified away by investing in both BNP Paribas and Enter Air 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 Enter Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BNP Paribas Bank and Enter Air SA, you can compare the effects of market volatilities on BNP Paribas and Enter Air 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 Enter Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNP Paribas and Enter Air.
Diversification Opportunities for BNP Paribas and Enter Air
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between BNP and Enter is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding BNP Paribas Bank and Enter Air SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enter Air SA 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 Bank are associated (or correlated) with Enter Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enter Air SA has no effect on the direction of BNP Paribas i.e., BNP Paribas and Enter Air go up and down completely randomly.
Pair Corralation between BNP Paribas and Enter Air
Assuming the 90 days trading horizon BNP Paribas is expected to generate 1.11 times less return on investment than Enter Air. But when comparing it to its historical volatility, BNP Paribas Bank is 1.15 times less risky than Enter Air. It trades about 0.06 of its potential returns per unit of risk. Enter Air SA is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,220 in Enter Air SA on October 11, 2024 and sell it today you would earn a total of 2,200 from holding Enter Air SA or generate 68.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BNP Paribas Bank vs. Enter Air SA
Performance |
| Timeline |
| BNP Paribas Bank |
| Enter Air SA |
BNP Paribas and Enter Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNP Paribas and Enter Air
The main advantage of trading using opposite BNP Paribas and Enter Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNP Paribas position performs unexpectedly, Enter Air 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 Enter Air will offset losses from the drop in Enter Air's long position.| BNP Paribas vs. PZ Cormay SA | BNP Paribas vs. Centrum Finansowe Banku | BNP Paribas vs. GreenX Metals | BNP Paribas vs. Noble Financials SA |
| Enter Air vs. SOFTWARE MANSION SPOLKA | Enter Air vs. Centrum Finansowe Banku | Enter Air vs. Alior Bank SA | Enter Air vs. BNP Paribas Bank |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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