Correlation Between AC SA and Santander Bank
Can any of the company-specific risk be diversified away by investing in both AC SA and Santander Bank 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 AC SA and Santander Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AC SA and Santander Bank Polska, you can compare the effects of market volatilities on AC SA and Santander Bank 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 AC SA with a short position of Santander Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of AC SA and Santander Bank.
Diversification Opportunities for AC SA and Santander Bank
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between ACG and Santander is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding AC SA and Santander Bank Polska in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santander Bank Polska and AC SA 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 AC SA are associated (or correlated) with Santander Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santander Bank Polska has no effect on the direction of AC SA i.e., AC SA and Santander Bank go up and down completely randomly.
Pair Corralation between AC SA and Santander Bank
Assuming the 90 days trading horizon AC SA is expected to generate 0.81 times more return on investment than Santander Bank. However, AC SA is 1.23 times less risky than Santander Bank. It trades about 0.15 of its potential returns per unit of risk. Santander Bank Polska is currently generating about 0.01 per unit of risk. If you would invest 2,750 in AC SA on September 13, 2024 and sell it today you would earn a total of 130.00 from holding AC SA or generate 4.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AC SA vs. Santander Bank Polska
Performance |
| Timeline |
| AC SA |
| Santander Bank Polska |
AC SA and Santander Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AC SA and Santander Bank
The main advantage of trading using opposite AC SA and Santander Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AC SA position performs unexpectedly, Santander Bank 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 Bank will offset losses from the drop in Santander Bank's long position.| AC SA vs. ERG SA | AC SA vs. Asseco Business Solutions | AC SA vs. Detalion Games SA | AC SA vs. Kogeneracja SA |
| Santander Bank vs. Drago entertainment SA | Santander Bank vs. Quantum Software SA | Santander Bank vs. Noble Financials SA | Santander Bank vs. BNP Paribas 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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