Correlation Between Texas Roadhouse and Banco Santander
Can any of the company-specific risk be diversified away by investing in both Texas Roadhouse 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 Texas Roadhouse and Banco Santander into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Texas Roadhouse and Banco Santander SA, you can compare the effects of market volatilities on Texas Roadhouse 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 Texas Roadhouse with a short position of Banco Santander. Check out your portfolio center. Please also check ongoing floating volatility patterns of Texas Roadhouse and Banco Santander.
Diversification Opportunities for Texas Roadhouse and Banco Santander
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Texas and Banco is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Texas Roadhouse and Banco Santander SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Santander SA and Texas Roadhouse 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 Texas Roadhouse 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 SA has no effect on the direction of Texas Roadhouse i.e., Texas Roadhouse and Banco Santander go up and down completely randomly.
Pair Corralation between Texas Roadhouse and Banco Santander
Assuming the 90 days horizon Texas Roadhouse is expected to generate 6.75 times less return on investment than Banco Santander. In addition to that, Texas Roadhouse is 1.2 times more volatile than Banco Santander SA. It trades about 0.01 of its total potential returns per unit of risk. Banco Santander SA is currently generating about 0.08 per unit of volatility. If you would invest 452.00 in Banco Santander SA on September 12, 2024 and sell it today you would earn a total of 12.00 from holding Banco Santander SA or generate 2.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Texas Roadhouse vs. Banco Santander SA
Performance |
| Timeline |
| Texas Roadhouse |
| Banco Santander SA |
Texas Roadhouse and Banco Santander Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Texas Roadhouse and Banco Santander
The main advantage of trading using opposite Texas Roadhouse and Banco Santander positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Texas Roadhouse 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.| Texas Roadhouse vs. Starbucks | Texas Roadhouse vs. Superior Plus Corp | Texas Roadhouse vs. SIVERS SEMICONDUCTORS AB | Texas Roadhouse vs. NorAm Drilling AS |
| Banco Santander vs. Lamar Advertising | Banco Santander vs. PPHE HOTEL GROUP | Banco Santander vs. Meli Hotels International | Banco Santander vs. YATRA ONLINE DL 0001 |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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