Correlation Between Banco Santander and Oakworth Capital
Can any of the company-specific risk be diversified away by investing in both Banco Santander and Oakworth Capital 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 Oakworth Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Santander Chile and Oakworth Capital, you can compare the effects of market volatilities on Banco Santander and Oakworth Capital 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 Oakworth Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and Oakworth Capital.
Diversification Opportunities for Banco Santander and Oakworth Capital
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Banco and Oakworth is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander Chile and Oakworth Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakworth Capital 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 Chile are associated (or correlated) with Oakworth Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakworth Capital has no effect on the direction of Banco Santander i.e., Banco Santander and Oakworth Capital go up and down completely randomly.
Pair Corralation between Banco Santander and Oakworth Capital
Given the investment horizon of 90 days Banco Santander Chile is expected to under-perform the Oakworth Capital. But the stock apears to be less risky and, when comparing its historical volatility, Banco Santander Chile is 1.15 times less risky than Oakworth Capital. The stock trades about 0.0 of its potential returns per unit of risk. The Oakworth Capital is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,800 in Oakworth Capital on September 1, 2024 and sell it today you would earn a total of 280.00 from holding Oakworth Capital or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Banco Santander Chile vs. Oakworth Capital
Performance |
| Timeline |
| Banco Santander Chile |
| Oakworth Capital |
Banco Santander and Oakworth Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Santander and Oakworth Capital
The main advantage of trading using opposite Banco Santander and Oakworth Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, Oakworth Capital 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 Oakworth Capital will offset losses from the drop in Oakworth Capital's long position.| Banco Santander vs. Bancolombia SA ADR | Banco Santander vs. Banco Bradesco SA | Banco Santander vs. Credicorp | Banco Santander vs. Banco Santander Brasil |
| Oakworth Capital vs. KeyCorp | Oakworth Capital vs. FinecoBank Banca Fineco | Oakworth Capital vs. AMMB Holdings Berhad | Oakworth Capital vs. Triumph Financial |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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