Correlation Between Xtrackers MSCI and BNP Paribas
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By analyzing existing cross correlation between Xtrackers MSCI World and BNP Paribas Easy, you can compare the effects of market volatilities on Xtrackers MSCI 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 Xtrackers MSCI with a short position of BNP Paribas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtrackers MSCI and BNP Paribas.
Diversification Opportunities for Xtrackers MSCI and BNP Paribas
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xtrackers and BNP is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Xtrackers MSCI World 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 Xtrackers MSCI 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 Xtrackers MSCI World 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 Xtrackers MSCI i.e., Xtrackers MSCI and BNP Paribas go up and down completely randomly.
Pair Corralation between Xtrackers MSCI and BNP Paribas
Assuming the 90 days trading horizon Xtrackers MSCI World is expected to generate 1.56 times more return on investment than BNP Paribas. However, Xtrackers MSCI is 1.56 times more volatile than BNP Paribas Easy. It trades about 0.18 of its potential returns per unit of risk. BNP Paribas Easy is currently generating about 0.15 per unit of risk. If you would invest 8,096 in Xtrackers MSCI World on September 25, 2024 and sell it today you would earn a total of 1,255 from holding Xtrackers MSCI World or generate 15.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Xtrackers MSCI World vs. BNP Paribas Easy
Performance |
Timeline |
Xtrackers MSCI World |
BNP Paribas Easy |
Xtrackers MSCI and BNP Paribas Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xtrackers MSCI and BNP Paribas
The main advantage of trading using opposite Xtrackers MSCI and BNP Paribas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtrackers MSCI 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.Xtrackers MSCI vs. Xtrackers II Global | Xtrackers MSCI vs. Xtrackers FTSE | Xtrackers MSCI vs. Xtrackers SP 500 | Xtrackers MSCI vs. Xtrackers MSCI |
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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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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