Correlation Between Banco Santander and Grupo Catalana
Can any of the company-specific risk be diversified away by investing in both Banco Santander and Grupo Catalana 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 Banco Santander and Grupo Catalana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Santander and Grupo Catalana Occidente, you can compare the effects of market volatilities on Banco Santander and Grupo Catalana 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 Banco Santander with a short position of Grupo Catalana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and Grupo Catalana.
Diversification Opportunities for Banco Santander and Grupo Catalana
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Banco and Grupo is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander and Grupo Catalana Occidente in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Catalana Occidente and Banco 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 Banco Santander are associated (or correlated) with Grupo Catalana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Catalana Occidente has no effect on the direction of Banco Santander i.e., Banco Santander and Grupo Catalana go up and down completely randomly.
Pair Corralation between Banco Santander and Grupo Catalana
Assuming the 90 days trading horizon Banco Santander is expected to generate 1.79 times more return on investment than Grupo Catalana. However, Banco Santander is 1.79 times more volatile than Grupo Catalana Occidente. It trades about 0.07 of its potential returns per unit of risk. Grupo Catalana Occidente is currently generating about 0.06 per unit of risk. If you would invest 256.00 in Banco Santander on August 30, 2024 and sell it today you would earn a total of 182.00 from holding Banco Santander or generate 71.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Santander vs. Grupo Catalana Occidente
Performance |
| Timeline |
| Banco Santander |
| Grupo Catalana Occidente |
Banco Santander and Grupo Catalana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Santander and Grupo Catalana
The main advantage of trading using opposite Banco Santander and Grupo Catalana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, Grupo Catalana 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 Grupo Catalana will offset losses from the drop in Grupo Catalana's long position.| Banco Santander vs. Repsol | Banco Santander vs. Iberdrola SA | Banco Santander vs. Banco de Sabadell | Banco Santander vs. Caixabank SA |
| Grupo Catalana vs. Metrovacesa SA | Grupo Catalana vs. Atom Hoteles Socimi | Grupo Catalana vs. Aedas Homes SL | Grupo Catalana vs. Hispanotels Inversiones SOCIMI |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |