Correlation Between Banco Santander and Bayfirst Financial
Can any of the company-specific risk be diversified away by investing in both Banco Santander and Bayfirst Financial 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 Bayfirst Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Santander Brasil and Bayfirst Financial Corp, you can compare the effects of market volatilities on Banco Santander and Bayfirst Financial 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 Bayfirst Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and Bayfirst Financial.
Diversification Opportunities for Banco Santander and Bayfirst Financial
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Banco and Bayfirst is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander Brasil and Bayfirst Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayfirst Financial Corp 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 Brasil are associated (or correlated) with Bayfirst Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayfirst Financial Corp has no effect on the direction of Banco Santander i.e., Banco Santander and Bayfirst Financial go up and down completely randomly.
Pair Corralation between Banco Santander and Bayfirst Financial
Given the investment horizon of 90 days Banco Santander Brasil is expected to under-perform the Bayfirst Financial. But the stock apears to be less risky and, when comparing its historical volatility, Banco Santander Brasil is 1.41 times less risky than Bayfirst Financial. The stock trades about -0.02 of its potential returns per unit of risk. The Bayfirst Financial Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,405 in Bayfirst Financial Corp on August 31, 2024 and sell it today you would lose (80.00) from holding Bayfirst Financial Corp or give up 5.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Santander Brasil vs. Bayfirst Financial Corp
Performance |
| Timeline |
| Banco Santander Brasil |
| Bayfirst Financial Corp |
Banco Santander and Bayfirst Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Santander and Bayfirst Financial
The main advantage of trading using opposite Banco Santander and Bayfirst Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, Bayfirst Financial 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 Bayfirst Financial will offset losses from the drop in Bayfirst Financial's long position.| Banco Santander vs. Banco De Chile | Banco Santander vs. CrossFirst Bankshares | Banco Santander vs. Banco Bradesco SA | Banco Santander vs. CF Bankshares |
| Bayfirst Financial vs. Home Federal Bancorp | Bayfirst Financial vs. LINKBANCORP | Bayfirst Financial vs. Affinity Bancshares | Bayfirst Financial vs. BayCom Corp |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |