Correlation Between BNP Paribas and SPDR Barclays
Can any of the company-specific risk be diversified away by investing in both BNP Paribas and SPDR Barclays 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 SPDR Barclays into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BNP Paribas Easy and SPDR Barclays Capital, you can compare the effects of market volatilities on BNP Paribas and SPDR Barclays 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 SPDR Barclays. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNP Paribas and SPDR Barclays.
Diversification Opportunities for BNP Paribas and SPDR Barclays
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BNP and SPDR is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding BNP Paribas Easy and SPDR Barclays Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Barclays Capital 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 Easy are associated (or correlated) with SPDR Barclays. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Barclays Capital has no effect on the direction of BNP Paribas i.e., BNP Paribas and SPDR Barclays go up and down completely randomly.
Pair Corralation between BNP Paribas and SPDR Barclays
Assuming the 90 days trading horizon BNP Paribas Easy is expected to generate 18.94 times more return on investment than SPDR Barclays. However, BNP Paribas is 18.94 times more volatile than SPDR Barclays Capital. It trades about 0.13 of its potential returns per unit of risk. SPDR Barclays Capital is currently generating about -0.11 per unit of risk. If you would invest 796.00 in BNP Paribas Easy on October 20, 2024 and sell it today you would earn a total of 22.00 from holding BNP Paribas Easy or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BNP Paribas Easy vs. SPDR Barclays Capital
Performance |
| Timeline |
| BNP Paribas Easy |
| SPDR Barclays Capital |
BNP Paribas and SPDR Barclays Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNP Paribas and SPDR Barclays
The main advantage of trading using opposite BNP Paribas and SPDR Barclays positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNP Paribas position performs unexpectedly, SPDR Barclays 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 SPDR Barclays will offset losses from the drop in SPDR Barclays' long position.| BNP Paribas vs. Lyxor UCITS Japan | BNP Paribas vs. Lyxor UCITS Japan | BNP Paribas vs. Lyxor UCITS Stoxx | BNP Paribas vs. Amundi CAC 40 |
| SPDR Barclays vs. Lyxor UCITS Japan | SPDR Barclays vs. Lyxor UCITS Japan | SPDR Barclays vs. Lyxor UCITS Stoxx | SPDR Barclays vs. Amundi CAC 40 |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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