Correlation Between Banco Santander and Engie Energia
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By analyzing existing cross correlation between Banco Santander Chile and Engie Energia Chile, you can compare the effects of market volatilities on Banco Santander and Engie Energia 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 Engie Energia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and Engie Energia.
Diversification Opportunities for Banco Santander and Engie Energia
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Banco and Engie is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander Chile and Engie Energia Chile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Engie Energia Chile 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 Engie Energia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Engie Energia Chile has no effect on the direction of Banco Santander i.e., Banco Santander and Engie Energia go up and down completely randomly.
Pair Corralation between Banco Santander and Engie Energia
Assuming the 90 days trading horizon Banco Santander Chile is expected to generate 0.85 times more return on investment than Engie Energia. However, Banco Santander Chile is 1.17 times less risky than Engie Energia. It trades about 0.07 of its potential returns per unit of risk. Engie Energia Chile is currently generating about 0.02 per unit of risk. If you would invest 4,708 in Banco Santander Chile on September 20, 2024 and sell it today you would earn a total of 61.00 from holding Banco Santander Chile or generate 1.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Santander Chile vs. Engie Energia Chile
Performance |
| Timeline |
| Banco Santander Chile |
| Engie Energia Chile |
Banco Santander and Engie Energia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Santander and Engie Energia
The main advantage of trading using opposite Banco Santander and Engie Energia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, Engie Energia 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 Engie Energia will offset losses from the drop in Engie Energia's long position.| Banco Santander vs. Banco de Chile | Banco Santander vs. Banco de Credito | Banco Santander vs. Cencosud | Banco Santander vs. Falabella |
| Engie Energia vs. Colbun | Engie Energia vs. Enel Chile SA | Engie Energia vs. CAP SA | Engie Energia vs. Enel Amricas 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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