Correlation Between SANTANDER and Helical Bar
Can any of the company-specific risk be diversified away by investing in both SANTANDER and Helical Bar 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 SANTANDER and Helical Bar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SANTANDER UK 10 and Helical Bar Plc, you can compare the effects of market volatilities on SANTANDER and Helical Bar 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 SANTANDER with a short position of Helical Bar. Check out your portfolio center. Please also check ongoing floating volatility patterns of SANTANDER and Helical Bar.
Diversification Opportunities for SANTANDER and Helical Bar
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SANTANDER and Helical is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding SANTANDER UK 10 and Helical Bar Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helical Bar Plc and 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 SANTANDER UK 10 are associated (or correlated) with Helical Bar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helical Bar Plc has no effect on the direction of SANTANDER i.e., SANTANDER and Helical Bar go up and down completely randomly.
Pair Corralation between SANTANDER and Helical Bar
Assuming the 90 days trading horizon SANTANDER UK 10 is expected to generate 0.48 times more return on investment than Helical Bar. However, SANTANDER UK 10 is 2.08 times less risky than Helical Bar. It trades about 0.07 of its potential returns per unit of risk. Helical Bar Plc is currently generating about -0.04 per unit of risk. If you would invest 11,771 in SANTANDER UK 10 on September 3, 2024 and sell it today you would earn a total of 4,099 from holding SANTANDER UK 10 or generate 34.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SANTANDER UK 10 vs. Helical Bar Plc
Performance |
| Timeline |
| SANTANDER UK 10 |
| Helical Bar Plc |
SANTANDER and Helical Bar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SANTANDER and Helical Bar
The main advantage of trading using opposite SANTANDER and Helical Bar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SANTANDER position performs unexpectedly, Helical Bar 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 Helical Bar will offset losses from the drop in Helical Bar's long position.| SANTANDER vs. MediaZest plc | SANTANDER vs. Greenroc Mining PLC | SANTANDER vs. Blackrock World Mining | SANTANDER vs. One Media iP |
| Helical Bar vs. Norman Broadbent Plc | Helical Bar vs. EVS Broadcast Equipment | Helical Bar vs. Applied Materials | Helical Bar vs. Host Hotels Resorts |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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