Correlation Between BNP Paribas and BNPP EHY
Can any of the company-specific risk be diversified away by investing in both BNP Paribas and BNPP EHY 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 BNPP EHY 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 BNPP EHY SRI, you can compare the effects of market volatilities on BNP Paribas and BNPP EHY 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 BNPP EHY. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNP Paribas and BNPP EHY.
Diversification Opportunities for BNP Paribas and BNPP EHY
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between BNP and BNPP is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding BNP Paribas Easy and BNPP EHY SRI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNPP EHY SRI 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 BNPP EHY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BNPP EHY SRI has no effect on the direction of BNP Paribas i.e., BNP Paribas and BNPP EHY go up and down completely randomly.
Pair Corralation between BNP Paribas and BNPP EHY
Assuming the 90 days trading horizon BNP Paribas Easy is expected to generate 1.27 times more return on investment than BNPP EHY. However, BNP Paribas is 1.27 times more volatile than BNPP EHY SRI. It trades about 0.27 of its potential returns per unit of risk. BNPP EHY SRI is currently generating about 0.16 per unit of risk. If you would invest 1,065 in BNP Paribas Easy on November 4, 2024 and sell it today you would earn a total of 12.00 from holding BNP Paribas Easy or generate 1.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BNP Paribas Easy vs. BNPP EHY SRI
Performance |
| Timeline |
| BNP Paribas Easy |
| BNPP EHY SRI |
BNP Paribas and BNPP EHY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNP Paribas and BNPP EHY
The main advantage of trading using opposite BNP Paribas and BNPP EHY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNP Paribas position performs unexpectedly, BNPP EHY 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 BNPP EHY will offset losses from the drop in BNPP EHY's long position.| BNP Paribas vs. BNP PARIBAS EASY | BNP Paribas vs. BNP Paribas Easy | BNP Paribas vs. BNP Paribas Easy | BNP Paribas vs. BNP Paribas Easy |
| BNPP EHY vs. BNPP BONDSRI ETF | BNPP EHY vs. BNPP LC EURPAB | BNPP EHY vs. BNPP Greenbond ETF | BNPP EHY vs. Amundi Index Solutions |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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