Correlation Between Oracle and BNP Paribas
Can any of the company-specific risk be diversified away by investing in both Oracle 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 Oracle and BNP Paribas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oracle and BNP Paribas Easy, you can compare the effects of market volatilities on Oracle 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 Oracle with a short position of BNP Paribas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oracle and BNP Paribas.
Diversification Opportunities for Oracle and BNP Paribas
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Oracle and BNP is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Oracle 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 Oracle 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 Oracle 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 Oracle i.e., Oracle and BNP Paribas go up and down completely randomly.
Pair Corralation between Oracle and BNP Paribas
Given the investment horizon of 90 days Oracle is expected to generate 1.66 times more return on investment than BNP Paribas. However, Oracle is 1.66 times more volatile than BNP Paribas Easy. It trades about 0.1 of its potential returns per unit of risk. BNP Paribas Easy is currently generating about 0.07 per unit of risk. If you would invest 10,799 in Oracle on September 4, 2024 and sell it today you would earn a total of 7,342 from holding Oracle or generate 67.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 56.55% |
| Values | Daily Returns |
Oracle vs. BNP Paribas Easy
Performance |
| Timeline |
| Oracle |
| BNP Paribas Easy |
Oracle and BNP Paribas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oracle and BNP Paribas
The main advantage of trading using opposite Oracle and BNP Paribas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oracle 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.| Oracle vs. Palo Alto Networks | Oracle vs. Crowdstrike Holdings | Oracle vs. Microsoft | Oracle vs. Block Inc |
| BNP Paribas vs. UBSFund Solutions MSCI | BNP Paribas vs. Vanguard SP 500 | BNP Paribas vs. iShares VII PLC | BNP Paribas vs. iShares Core SP |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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