Correlation Between Brand 24 and Banco Santander
Can any of the company-specific risk be diversified away by investing in both Brand 24 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 Brand 24 and Banco Santander into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brand 24 SA and Banco Santander SA, you can compare the effects of market volatilities on Brand 24 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 Brand 24 with a short position of Banco Santander. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brand 24 and Banco Santander.
Diversification Opportunities for Brand 24 and Banco Santander
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Brand and Banco is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Brand 24 SA and Banco Santander SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Santander SA and Brand 24 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 Brand 24 SA 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 SA has no effect on the direction of Brand 24 i.e., Brand 24 and Banco Santander go up and down completely randomly.
Pair Corralation between Brand 24 and Banco Santander
Assuming the 90 days trading horizon Brand 24 is expected to generate 2.91 times less return on investment than Banco Santander. But when comparing it to its historical volatility, Brand 24 SA is 1.67 times less risky than Banco Santander. It trades about 0.04 of its potential returns per unit of risk. Banco Santander SA is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,023 in Banco Santander SA on November 28, 2024 and sell it today you would earn a total of 508.00 from holding Banco Santander SA or generate 25.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.83% |
| Values | Daily Returns |
Brand 24 SA vs. Banco Santander SA
Performance |
| Timeline |
| Brand 24 SA |
| Banco Santander SA |
Brand 24 and Banco Santander Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brand 24 and Banco Santander
The main advantage of trading using opposite Brand 24 and Banco Santander positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brand 24 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.| Brand 24 vs. GreenX Metals | Brand 24 vs. mBank SA | Brand 24 vs. Varsav Game Studios | Brand 24 vs. ING Bank lski |
| Banco Santander vs. Saule Technologies SA | Banco Santander vs. Skyline Investment SA | Banco Santander vs. Echo Investment SA | Banco Santander vs. GreenX Metals |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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