Correlation Between Amundi MSCI and BNP Paribas
Can any of the company-specific risk be diversified away by investing in both Amundi MSCI and BNP Paribas 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 Amundi MSCI and BNP Paribas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi MSCI Europe and BNP Paribas Easy, you can compare the effects of market volatilities on Amundi MSCI and BNP Paribas 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 Amundi MSCI with a short position of BNP Paribas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi MSCI and BNP Paribas.
Diversification Opportunities for Amundi MSCI and BNP Paribas
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Amundi and BNP is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Amundi MSCI Europe and BNP Paribas Easy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNP Paribas Easy and Amundi MSCI 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 Amundi MSCI Europe are associated (or correlated) with BNP Paribas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BNP Paribas Easy has no effect on the direction of Amundi MSCI i.e., Amundi MSCI and BNP Paribas go up and down completely randomly.
Pair Corralation between Amundi MSCI and BNP Paribas
Assuming the 90 days trading horizon Amundi MSCI Europe is expected to under-perform the BNP Paribas. But the etf apears to be less risky and, when comparing its historical volatility, Amundi MSCI Europe is 1.1 times less risky than BNP Paribas. The etf trades about -0.03 of its potential returns per unit of risk. The BNP Paribas Easy is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 1,229 in BNP Paribas Easy on September 2, 2024 and sell it today you would lose (43.00) from holding BNP Paribas Easy or give up 3.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi MSCI Europe vs. BNP Paribas Easy
Performance |
| Timeline |
| Amundi MSCI Europe |
| BNP Paribas Easy |
Amundi MSCI and BNP Paribas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi MSCI and BNP Paribas
The main advantage of trading using opposite Amundi MSCI and BNP Paribas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi MSCI position performs unexpectedly, BNP Paribas 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 BNP Paribas will offset losses from the drop in BNP Paribas' long position.| Amundi MSCI vs. Manitou BF SA | Amundi MSCI vs. Granite 3x LVMH | Amundi MSCI vs. 21Shares Polkadot ETP | Amundi MSCI vs. Ekinops SA |
| BNP Paribas vs. BNP Paribas Easy | BNP Paribas vs. Multi Units Luxembourg | BNP Paribas vs. Multi Units Luxembourg | BNP Paribas vs. Multi Units France |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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