Correlation Between COMINTL BANK and BNP Paribas
Can any of the company-specific risk be diversified away by investing in both COMINTL BANK 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 COMINTL BANK and BNP Paribas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COMINTL BANK ADR1 and BNP Paribas SA, you can compare the effects of market volatilities on COMINTL BANK 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 COMINTL BANK with a short position of BNP Paribas. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMINTL BANK and BNP Paribas.
Diversification Opportunities for COMINTL BANK and BNP Paribas
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between COMINTL and BNP is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding COMINTL BANK ADR1 and BNP Paribas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNP Paribas SA and COMINTL BANK 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 COMINTL BANK ADR1 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 SA has no effect on the direction of COMINTL BANK i.e., COMINTL BANK and BNP Paribas go up and down completely randomly.
Pair Corralation between COMINTL BANK and BNP Paribas
Assuming the 90 days trading horizon COMINTL BANK ADR1 is expected to under-perform the BNP Paribas. In addition to that, COMINTL BANK is 1.4 times more volatile than BNP Paribas SA. It trades about -0.02 of its total potential returns per unit of risk. BNP Paribas SA is currently generating about 0.4 per unit of volatility. If you would invest 5,896 in BNP Paribas SA on November 30, 2024 and sell it today you would earn a total of 1,389 from holding BNP Paribas SA or generate 23.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COMINTL BANK ADR1 vs. BNP Paribas SA
Performance |
| Timeline |
| COMINTL BANK ADR1 |
| BNP Paribas SA |
COMINTL BANK and BNP Paribas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COMINTL BANK and BNP Paribas
The main advantage of trading using opposite COMINTL BANK and BNP Paribas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COMINTL BANK 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.| COMINTL BANK vs. BNP Paribas SA | COMINTL BANK vs. DNB BANK ASA | COMINTL BANK vs. Deutsche Bank Aktiengesellschaft | COMINTL BANK vs. Socit Gnrale Socit |
| BNP Paribas vs. SIDETRADE EO 1 | BNP Paribas vs. BAKED GAMES SA | BNP Paribas vs. ScanSource | BNP Paribas vs. Indutrade AB |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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