Correlation Between Banco Santander and BBVA Banco
Can any of the company-specific risk be diversified away by investing in both Banco Santander and BBVA Banco 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 Banco Santander and BBVA Banco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Santander Ro and BBVA Banco Frances, you can compare the effects of market volatilities on Banco Santander and BBVA Banco 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 Banco Santander with a short position of BBVA Banco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and BBVA Banco.
Diversification Opportunities for Banco Santander and BBVA Banco
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Banco and BBVA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander Ro and BBVA Banco Frances in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BBVA Banco Frances and Banco Santander 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 Banco Santander Ro are associated (or correlated) with BBVA Banco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BBVA Banco Frances has no effect on the direction of Banco Santander i.e., Banco Santander and BBVA Banco go up and down completely randomly.
Pair Corralation between Banco Santander and BBVA Banco
If you would invest 455,000 in BBVA Banco Frances on November 2, 2024 and sell it today you would earn a total of 440,000 from holding BBVA Banco Frances or generate 96.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.03% |
| Values | Daily Returns |
Banco Santander Ro vs. BBVA Banco Frances
Performance |
| Timeline |
| Banco Santander Ro |
| BBVA Banco Frances |
Banco Santander and BBVA Banco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Santander and BBVA Banco
The main advantage of trading using opposite Banco Santander and BBVA Banco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, BBVA Banco 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 BBVA Banco will offset losses from the drop in BBVA Banco's long position.| Banco Santander vs. United States Steel | Banco Santander vs. Compania de Transporte | Banco Santander vs. Harmony Gold Mining | Banco Santander vs. Agrometal SAI |
| BBVA Banco vs. Agrometal SAI | BBVA Banco vs. Transportadora de Gas | BBVA Banco vs. International Business Machines | BBVA Banco vs. Grimoldi SA |
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 CEOs Directory module to screen CEOs from public companies around the world.
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