Correlation Between Creotech Instruments and Santander Bank
Can any of the company-specific risk be diversified away by investing in both Creotech Instruments and Santander Bank 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 Creotech Instruments and Santander Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Creotech Instruments SA and Santander Bank Polska, you can compare the effects of market volatilities on Creotech Instruments and Santander Bank 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 Creotech Instruments with a short position of Santander Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Creotech Instruments and Santander Bank.
Diversification Opportunities for Creotech Instruments and Santander Bank
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Creotech and Santander is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Creotech Instruments SA and Santander Bank Polska in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santander Bank Polska and Creotech Instruments 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 Creotech Instruments SA are associated (or correlated) with Santander Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santander Bank Polska has no effect on the direction of Creotech Instruments i.e., Creotech Instruments and Santander Bank go up and down completely randomly.
Pair Corralation between Creotech Instruments and Santander Bank
Assuming the 90 days trading horizon Creotech Instruments is expected to generate 1.69 times less return on investment than Santander Bank. In addition to that, Creotech Instruments is 1.51 times more volatile than Santander Bank Polska. It trades about 0.03 of its total potential returns per unit of risk. Santander Bank Polska is currently generating about 0.08 per unit of volatility. If you would invest 22,847 in Santander Bank Polska on September 2, 2024 and sell it today you would earn a total of 20,873 from holding Santander Bank Polska or generate 91.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Creotech Instruments SA vs. Santander Bank Polska
Performance |
| Timeline |
| Creotech Instruments |
| Santander Bank Polska |
Creotech Instruments and Santander Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Creotech Instruments and Santander Bank
The main advantage of trading using opposite Creotech Instruments and Santander Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Creotech Instruments position performs unexpectedly, Santander Bank 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 Santander Bank will offset losses from the drop in Santander Bank's long position.| Creotech Instruments vs. Asseco Business Solutions | Creotech Instruments vs. Detalion Games SA | Creotech Instruments vs. Asseco South Eastern | Creotech Instruments vs. CFI Holding SA |
| Santander Bank vs. PZ Cormay SA | Santander Bank vs. MW Trade SA | Santander Bank vs. LSI Software SA | Santander Bank vs. Logintrade 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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