Correlation Between Santander Bank and Medicalg
Can any of the company-specific risk be diversified away by investing in both Santander Bank and Medicalg 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 Bank and Medicalg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Santander Bank Polska and Medicalg, you can compare the effects of market volatilities on Santander Bank and Medicalg 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 Bank with a short position of Medicalg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Santander Bank and Medicalg.
Diversification Opportunities for Santander Bank and Medicalg
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Santander and Medicalg is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Santander Bank Polska and Medicalg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medicalg and Santander Bank 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 Bank Polska are associated (or correlated) with Medicalg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medicalg has no effect on the direction of Santander Bank i.e., Santander Bank and Medicalg go up and down completely randomly.
Pair Corralation between Santander Bank and Medicalg
Assuming the 90 days trading horizon Santander Bank Polska is expected to generate 0.49 times more return on investment than Medicalg. However, Santander Bank Polska is 2.03 times less risky than Medicalg. It trades about 0.09 of its potential returns per unit of risk. Medicalg is currently generating about 0.04 per unit of risk. If you would invest 22,935 in Santander Bank Polska on September 12, 2024 and sell it today you would earn a total of 24,835 from holding Santander Bank Polska or generate 108.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Santander Bank Polska vs. Medicalg
Performance |
| Timeline |
| Santander Bank Polska |
| Medicalg |
Santander Bank and Medicalg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Santander Bank and Medicalg
The main advantage of trading using opposite Santander Bank and Medicalg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Santander Bank position performs unexpectedly, Medicalg 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 Medicalg will offset losses from the drop in Medicalg's long position.| Santander Bank vs. Medicofarma Biotech SA | Santander Bank vs. UF Games SA | Santander Bank vs. CI Games SA | Santander Bank vs. Movie Games SA |
| Medicalg vs. ING Bank lski | Medicalg vs. Centrum Finansowe Banku | Medicalg vs. Saule Technologies SA | Medicalg vs. Santander Bank Polska |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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