Correlation Between Lyxor Commodities and BNP Paribas
Can any of the company-specific risk be diversified away by investing in both Lyxor Commodities 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 Lyxor Commodities and BNP Paribas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyxor Commodities RefinitivCoreCommodity and BNP Paribas Easy, you can compare the effects of market volatilities on Lyxor Commodities 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 Lyxor Commodities with a short position of BNP Paribas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyxor Commodities and BNP Paribas.
Diversification Opportunities for Lyxor Commodities and BNP Paribas
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lyxor and BNP is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Lyxor Commodities RefinitivCor 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 Lyxor Commodities 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 Lyxor Commodities RefinitivCoreCommodity 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 Lyxor Commodities i.e., Lyxor Commodities and BNP Paribas go up and down completely randomly.
Pair Corralation between Lyxor Commodities and BNP Paribas
Assuming the 90 days trading horizon Lyxor Commodities is expected to generate 3.1 times less return on investment than BNP Paribas. In addition to that, Lyxor Commodities is 1.06 times more volatile than BNP Paribas Easy. It trades about 0.07 of its total potential returns per unit of risk. BNP Paribas Easy is currently generating about 0.24 per unit of volatility. If you would invest 2,115 in BNP Paribas Easy on September 3, 2024 and sell it today you would earn a total of 76.00 from holding BNP Paribas Easy or generate 3.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Lyxor Commodities RefinitivCor vs. BNP Paribas Easy
Performance |
| Timeline |
| Lyxor Commodities |
| BNP Paribas Easy |
Lyxor Commodities and BNP Paribas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyxor Commodities and BNP Paribas
The main advantage of trading using opposite Lyxor Commodities and BNP Paribas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyxor Commodities 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.| Lyxor Commodities vs. Lyxor MSCI Brazil | Lyxor Commodities vs. Multi Units France | Lyxor Commodities vs. Lyxor UCITS Stoxx | Lyxor Commodities vs. Multi Units France |
| BNP Paribas vs. Amundi Index Solutions | BNP Paribas vs. Amundi Index Solutions | BNP Paribas vs. Manitou BF SA | BNP Paribas vs. Ossiam Minimum Variance |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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