Correlation Between SANTANDER and Impax Environmental
Can any of the company-specific risk be diversified away by investing in both SANTANDER and Impax Environmental 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 Impax Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SANTANDER UK 8 and Impax Environmental Markets, you can compare the effects of market volatilities on SANTANDER and Impax Environmental 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 Impax Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of SANTANDER and Impax Environmental.
Diversification Opportunities for SANTANDER and Impax Environmental
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SANTANDER and Impax is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding SANTANDER UK 8 and Impax Environmental Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Impax Environmental 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 8 are associated (or correlated) with Impax Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Impax Environmental has no effect on the direction of SANTANDER i.e., SANTANDER and Impax Environmental go up and down completely randomly.
Pair Corralation between SANTANDER and Impax Environmental
Assuming the 90 days trading horizon SANTANDER UK 8 is expected to generate 0.27 times more return on investment than Impax Environmental. However, SANTANDER UK 8 is 3.68 times less risky than Impax Environmental. It trades about -0.18 of its potential returns per unit of risk. Impax Environmental Markets is currently generating about -0.24 per unit of risk. If you would invest 13,650 in SANTANDER UK 8 on September 4, 2024 and sell it today you would lose (100.00) from holding SANTANDER UK 8 or give up 0.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
SANTANDER UK 8 vs. Impax Environmental Markets
Performance |
| Timeline |
| SANTANDER UK 8 |
| Impax Environmental |
SANTANDER and Impax Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SANTANDER and Impax Environmental
The main advantage of trading using opposite SANTANDER and Impax Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SANTANDER position performs unexpectedly, Impax Environmental 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 Impax Environmental will offset losses from the drop in Impax Environmental's long position.| SANTANDER vs. SupplyMe Capital PLC | SANTANDER vs. SM Energy Co | SANTANDER vs. FuelCell Energy | SANTANDER vs. Grand Vision Media |
| Impax Environmental vs. SupplyMe Capital PLC | Impax Environmental vs. Lloyds Banking Group | Impax Environmental vs. Premier African Minerals | Impax Environmental vs. SANTANDER UK 8 |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |