Correlation Between OTP Bank and BNP Paribas
Can any of the company-specific risk be diversified away by investing in both OTP 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 OTP 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 OTP Bank Nyrt and BNP Paribas SA, you can compare the effects of market volatilities on OTP 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 OTP Bank with a short position of BNP Paribas. Check out your portfolio center. Please also check ongoing floating volatility patterns of OTP Bank and BNP Paribas.
Diversification Opportunities for OTP Bank and BNP Paribas
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between OTP and BNP is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding OTP Bank Nyrt 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 OTP 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 OTP Bank Nyrt 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 OTP Bank i.e., OTP Bank and BNP Paribas go up and down completely randomly.
Pair Corralation between OTP Bank and BNP Paribas
If you would invest 5,833 in BNP Paribas SA on October 28, 2024 and sell it today you would earn a total of 524.00 from holding BNP Paribas SA or generate 8.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
OTP Bank Nyrt vs. BNP Paribas SA
Performance |
| Timeline |
| OTP Bank Nyrt |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| BNP Paribas SA |
OTP Bank and BNP Paribas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OTP Bank and BNP Paribas
The main advantage of trading using opposite OTP Bank and BNP Paribas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OTP 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.| OTP Bank vs. STGEORGE MINING LTD | OTP Bank vs. Chiba Bank | OTP Bank vs. Direct Line Insurance | OTP Bank vs. Synovus Financial Corp |
| BNP Paribas vs. JAPAN TOBACCO UNSPADR12 | BNP Paribas vs. STRAYER EDUCATION | BNP Paribas vs. betterU Education Corp | BNP Paribas vs. MAVEN WIRELESS SWEDEN |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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