Correlation Between Banco Santander and E Shopping
Can any of the company-specific risk be diversified away by investing in both Banco Santander and E Shopping 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 E Shopping into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banco Santander SA and E shopping Group SA, you can compare the effects of market volatilities on Banco Santander and E Shopping 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 E Shopping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and E Shopping.
Diversification Opportunities for Banco Santander and E Shopping
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Banco and ESG is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander SA and E shopping Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on E shopping Group 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 SA are associated (or correlated) with E Shopping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of E shopping Group has no effect on the direction of Banco Santander i.e., Banco Santander and E Shopping go up and down completely randomly.
Pair Corralation between Banco Santander and E Shopping
Assuming the 90 days trading horizon Banco Santander is expected to generate 146.59 times less return on investment than E Shopping. But when comparing it to its historical volatility, Banco Santander SA is 7.66 times less risky than E Shopping. It trades about 0.02 of its potential returns per unit of risk. E shopping Group SA is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 50.00 in E shopping Group SA on October 17, 2024 and sell it today you would earn a total of 49.00 from holding E shopping Group SA or generate 98.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Banco Santander SA vs. E shopping Group SA
Performance |
| Timeline |
| Banco Santander SA |
| E shopping Group |
Banco Santander and E Shopping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Santander and E Shopping
The main advantage of trading using opposite Banco Santander and E Shopping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, E Shopping 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 E Shopping will offset losses from the drop in E Shopping's long position.| Banco Santander vs. PZ Cormay SA | Banco Santander vs. Quantum Software SA | Banco Santander vs. Mlk Foods Public | Banco Santander vs. Drago entertainment SA |
| E Shopping vs. MW Trade SA | E Shopping vs. M Food SA | E Shopping vs. Play2Chill SA | E Shopping vs. PLAYWAY SA |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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