Correlation Between IShares SP and BNP Paribas
Can any of the company-specific risk be diversified away by investing in both IShares SP 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 IShares SP and BNP Paribas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares SP 500 and BNP Paribas Easy, you can compare the effects of market volatilities on IShares SP 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 IShares SP with a short position of BNP Paribas. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares SP and BNP Paribas.
Diversification Opportunities for IShares SP and BNP Paribas
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IShares and BNP is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding iShares SP 500 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 IShares SP 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 iShares SP 500 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 IShares SP i.e., IShares SP and BNP Paribas go up and down completely randomly.
Pair Corralation between IShares SP and BNP Paribas
Assuming the 90 days trading horizon iShares SP 500 is expected to generate 0.8 times more return on investment than BNP Paribas. However, iShares SP 500 is 1.25 times less risky than BNP Paribas. It trades about 0.26 of its potential returns per unit of risk. BNP Paribas Easy is currently generating about 0.12 per unit of risk. If you would invest 5,876 in iShares SP 500 on May 28, 2025 and sell it today you would earn a total of 566.00 from holding iShares SP 500 or generate 9.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.39% |
| Values | Daily Returns |
iShares SP 500 vs. BNP Paribas Easy
Performance |
| Timeline |
| iShares SP 500 |
| BNP Paribas Easy |
IShares SP and BNP Paribas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares SP and BNP Paribas
The main advantage of trading using opposite IShares SP and BNP Paribas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares SP 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.| IShares SP vs. iShares Emerging Asia | IShares SP vs. iShares MSCI Global | IShares SP vs. iShares VII PLC | IShares SP vs. iShares iBonds Dec |
| BNP Paribas vs. BNP Paribas Easy | BNP Paribas vs. BNP Paribas Easy | BNP Paribas vs. BNP Paribas Easy | BNP Paribas vs. BNP Paribas Easy |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |