Correlation Between Agilent Technologies and Banco Santander
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Banco 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 Agilent Technologies and Banco Santander into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Banco Santander Chile, you can compare the effects of market volatilities on Agilent Technologies and Banco 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 Agilent Technologies with a short position of Banco Santander. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Banco Santander.
Diversification Opportunities for Agilent Technologies and Banco Santander
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Agilent and Banco is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Banco Santander Chile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Santander Chile and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Banco Santander. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco Santander Chile has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Banco Santander go up and down completely randomly.
Pair Corralation between Agilent Technologies and Banco Santander
Assuming the 90 days trading horizon Agilent Technologies is expected to generate 2.83 times less return on investment than Banco Santander. In addition to that, Agilent Technologies is 1.33 times more volatile than Banco Santander Chile. It trades about 0.01 of its total potential returns per unit of risk. Banco Santander Chile is currently generating about 0.06 per unit of volatility. If you would invest 3,779 in Banco Santander Chile on August 30, 2024 and sell it today you would earn a total of 1,811 from holding Banco Santander Chile or generate 47.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 73.09% |
| Values | Daily Returns |
Agilent Technologies vs. Banco Santander Chile
Performance |
| Timeline |
| Agilent Technologies |
| Banco Santander Chile |
Agilent Technologies and Banco Santander Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and Banco Santander
The main advantage of trading using opposite Agilent Technologies and Banco Santander positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Banco 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 Banco Santander will offset losses from the drop in Banco Santander's long position.| Agilent Technologies vs. Brpr Corporate Offices | Agilent Technologies vs. Take Two Interactive Software | Agilent Technologies vs. Capital One Financial | Agilent Technologies vs. British American Tobacco |
| Banco Santander vs. Paycom Software | Banco Santander vs. Beyond Meat | Banco Santander vs. Take Two Interactive Software | Banco Santander vs. Hospital Mater Dei |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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