Correlation Between BNP Paribas and SVB T
Can any of the company-specific risk be diversified away by investing in both BNP Paribas and SVB T 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 SVB T 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 SVB T Corp, you can compare the effects of market volatilities on BNP Paribas and SVB T 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 SVB T. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNP Paribas and SVB T.
Diversification Opportunities for BNP Paribas and SVB T
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BNP and SVB is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding BNP Paribas SA and SVB T Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SVB T Corp 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 SVB T. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SVB T Corp has no effect on the direction of BNP Paribas i.e., BNP Paribas and SVB T go up and down completely randomly.
Pair Corralation between BNP Paribas and SVB T
Assuming the 90 days horizon BNP Paribas SA is expected to generate 2.12 times more return on investment than SVB T. However, BNP Paribas is 2.12 times more volatile than SVB T Corp. It trades about 0.04 of its potential returns per unit of risk. SVB T Corp is currently generating about 0.0 per unit of risk. If you would invest 4,780 in BNP Paribas SA on August 26, 2024 and sell it today you would earn a total of 1,295 from holding BNP Paribas SA or generate 27.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 77.96% |
| Values | Daily Returns |
BNP Paribas SA vs. SVB T Corp
Performance |
| Timeline |
| BNP Paribas SA |
| SVB T Corp |
BNP Paribas and SVB T Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNP Paribas and SVB T
The main advantage of trading using opposite BNP Paribas and SVB T positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNP Paribas position performs unexpectedly, SVB T 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 SVB T will offset losses from the drop in SVB T's long position.| BNP Paribas vs. Standard Bank Group | BNP Paribas vs. PSB Holdings | BNP Paribas vs. United Overseas Bank | BNP Paribas vs. Turkiye Garanti Bankasi |
| SVB T vs. Standard Bank Group | SVB T vs. PSB Holdings | SVB T vs. United Overseas Bank | SVB T vs. Turkiye Garanti Bankasi |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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