Correlation Between HCA Healthcare, and Banco Santander
Can any of the company-specific risk be diversified away by investing in both HCA Healthcare, 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 HCA Healthcare, and Banco Santander into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HCA Healthcare, and Banco Santander Chile, you can compare the effects of market volatilities on HCA Healthcare, 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 HCA Healthcare, with a short position of Banco Santander. Check out your portfolio center. Please also check ongoing floating volatility patterns of HCA Healthcare, and Banco Santander.
Diversification Opportunities for HCA Healthcare, and Banco Santander
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between HCA and Banco is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding HCA Healthcare, 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 HCA Healthcare, 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 HCA Healthcare, 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 HCA Healthcare, i.e., HCA Healthcare, and Banco Santander go up and down completely randomly.
Pair Corralation between HCA Healthcare, and Banco Santander
Assuming the 90 days trading horizon HCA Healthcare, is expected to generate 1.17 times more return on investment than Banco Santander. However, HCA Healthcare, is 1.17 times more volatile than Banco Santander Chile. It trades about 0.21 of its potential returns per unit of risk. Banco Santander Chile is currently generating about 0.17 per unit of risk. If you would invest 9,250 in HCA Healthcare, on November 3, 2024 and sell it today you would earn a total of 620.00 from holding HCA Healthcare, or generate 6.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HCA Healthcare, vs. Banco Santander Chile
Performance |
| Timeline |
| HCA Healthcare, |
| Banco Santander Chile |
HCA Healthcare, and Banco Santander Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HCA Healthcare, and Banco Santander
The main advantage of trading using opposite HCA Healthcare, and Banco Santander positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HCA Healthcare, 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.| HCA Healthcare, vs. GP Investments | HCA Healthcare, vs. STMicroelectronics NV | HCA Healthcare, vs. Eastman Chemical | HCA Healthcare, vs. Seagate Technology Holdings |
| Banco Santander vs. Warner Music Group | Banco Santander vs. Tyson Foods | Banco Santander vs. Academy Sports and | Banco Santander vs. Apartment Investment and |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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