Correlation Between Cembra Money and SANTANDER
Can any of the company-specific risk be diversified away by investing in both Cembra Money and SANTANDER 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 Cembra Money and SANTANDER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cembra Money Bank and SANTANDER UK 10, you can compare the effects of market volatilities on Cembra Money and SANTANDER 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 Cembra Money with a short position of SANTANDER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cembra Money and SANTANDER.
Diversification Opportunities for Cembra Money and SANTANDER
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Cembra and SANTANDER is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Cembra Money Bank and SANTANDER UK 10 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANTANDER UK 10 and Cembra Money 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 Cembra Money Bank are associated (or correlated) with SANTANDER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANTANDER UK 10 has no effect on the direction of Cembra Money i.e., Cembra Money and SANTANDER go up and down completely randomly.
Pair Corralation between Cembra Money and SANTANDER
Assuming the 90 days trading horizon Cembra Money Bank is expected to generate 1.69 times more return on investment than SANTANDER. However, Cembra Money is 1.69 times more volatile than SANTANDER UK 10. It trades about 0.22 of its potential returns per unit of risk. SANTANDER UK 10 is currently generating about -0.05 per unit of risk. If you would invest 8,055 in Cembra Money Bank on September 12, 2024 and sell it today you would earn a total of 295.00 from holding Cembra Money Bank or generate 3.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cembra Money Bank vs. SANTANDER UK 10
Performance |
| Timeline |
| Cembra Money Bank |
| SANTANDER UK 10 |
Cembra Money and SANTANDER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cembra Money and SANTANDER
The main advantage of trading using opposite Cembra Money and SANTANDER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cembra Money position performs unexpectedly, SANTANDER 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 SANTANDER will offset losses from the drop in SANTANDER's long position.| Cembra Money vs. Hong Kong Land | Cembra Money vs. Neometals | Cembra Money vs. Coor Service Management | Cembra Money vs. Fidelity Sustainable USD |
| SANTANDER vs. Alior Bank SA | SANTANDER vs. Zegona Communications Plc | SANTANDER vs. Sparebank 1 SR | SANTANDER vs. Cembra Money Bank |
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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