Correlation Between First Republic and Banco Santander
Can any of the company-specific risk be diversified away by investing in both First Republic and Banco Santander 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 First Republic and Banco Santander into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Republic Bank and Banco Santander Chile, you can compare the effects of market volatilities on First Republic and Banco Santander 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 First Republic with a short position of Banco Santander. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Republic and Banco Santander.
Diversification Opportunities for First Republic and Banco Santander
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between First and Banco is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding First Republic Bank and Banco Santander Chile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Santander Chile and First Republic 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 First Republic Bank are associated (or correlated) with Banco Santander. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco Santander Chile has no effect on the direction of First Republic i.e., First Republic and Banco Santander go up and down completely randomly.
Pair Corralation between First Republic and Banco Santander
If you would invest 0.03 in First Republic Bank on October 25, 2024 and sell it today you would earn a total of 0.00 from holding First Republic Bank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 1.67% |
| Values | Daily Returns |
First Republic Bank vs. Banco Santander Chile
Performance |
| Timeline |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Banco Santander Chile |
First Republic and Banco Santander Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Republic and Banco Santander
The main advantage of trading using opposite First Republic and Banco Santander positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Republic position performs unexpectedly, Banco Santander 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 Banco Santander will offset losses from the drop in Banco Santander's long position.| First Republic vs. Space Communication | First Republic vs. Integrated Drilling Equipment | First Republic vs. Pinterest | First Republic vs. Tenaris SA ADR |
| Banco Santander vs. Bancolombia SA ADR | Banco Santander vs. Banco Bradesco SA | Banco Santander vs. Credicorp | Banco Santander vs. Banco Santander Brasil |
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.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |