Correlation Between Santander Bank and Notoria
Can any of the company-specific risk be diversified away by investing in both Santander Bank and Notoria 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 Notoria 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 Notoria, you can compare the effects of market volatilities on Santander Bank and Notoria 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 Notoria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Santander Bank and Notoria.
Diversification Opportunities for Santander Bank and Notoria
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Santander and Notoria is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Santander Bank Polska and Notoria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Notoria 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 Notoria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Notoria has no effect on the direction of Santander Bank i.e., Santander Bank and Notoria go up and down completely randomly.
Pair Corralation between Santander Bank and Notoria
Assuming the 90 days trading horizon Santander Bank is expected to generate 1.03 times less return on investment than Notoria. But when comparing it to its historical volatility, Santander Bank Polska is 2.2 times less risky than Notoria. It trades about 0.09 of its potential returns per unit of risk. Notoria is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 681.00 in Notoria on September 14, 2024 and sell it today you would earn a total of 144.00 from holding Notoria or generate 21.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 45.34% |
| Values | Daily Returns |
Santander Bank Polska vs. Notoria
Performance |
| Timeline |
| Santander Bank Polska |
| Notoria |
Santander Bank and Notoria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Santander Bank and Notoria
The main advantage of trading using opposite Santander Bank and Notoria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Santander Bank position performs unexpectedly, Notoria 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 Notoria will offset losses from the drop in Notoria's long position.| Santander Bank vs. Drago entertainment SA | Santander Bank vs. Quantum Software SA | Santander Bank vs. Noble Financials SA | Santander Bank vs. BNP Paribas Bank |
| Notoria vs. Road Studio SA | Notoria vs. Santander Bank Polska | Notoria vs. GreenX Metals | Notoria vs. Movie Games 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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