Correlation Between Take Two and Banco Santander
Can any of the company-specific risk be diversified away by investing in both Take Two and Banco Santander 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 Take Two and Banco Santander into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Take Two Interactive Software and Banco Santander SA, you can compare the effects of market volatilities on Take Two and Banco Santander 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 Take Two with a short position of Banco Santander. Check out your portfolio center. Please also check ongoing floating volatility patterns of Take Two and Banco Santander.
Diversification Opportunities for Take Two and Banco Santander
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Take and Banco is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Take Two Interactive Software and Banco Santander SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco Santander SA and Take Two 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 Take Two Interactive Software are associated (or correlated) with Banco Santander. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco Santander SA has no effect on the direction of Take Two i.e., Take Two and Banco Santander go up and down completely randomly.
Pair Corralation between Take Two and Banco Santander
Assuming the 90 days trading horizon Take Two is expected to generate 1.25 times less return on investment than Banco Santander. In addition to that, Take Two is 1.77 times more volatile than Banco Santander SA. It trades about 0.03 of its total potential returns per unit of risk. Banco Santander SA is currently generating about 0.07 per unit of volatility. If you would invest 2,787 in Banco Santander SA on October 20, 2024 and sell it today you would earn a total of 53.00 from holding Banco Santander SA or generate 1.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Take Two Interactive Software vs. Banco Santander SA
Performance |
| Timeline |
| Take Two Interactive |
| Banco Santander SA |
Take Two and Banco Santander Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Take Two and Banco Santander
The main advantage of trading using opposite Take Two and Banco Santander positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Take Two position performs unexpectedly, Banco Santander 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 Banco Santander will offset losses from the drop in Banco Santander's long position.| Take Two vs. Delta Air Lines | Take Two vs. Eastman Chemical | Take Two vs. MAHLE Metal Leve | Take Two vs. Vulcan Materials |
| Banco Santander vs. Truist Financial | Banco Santander vs. ICICI Bank Limited | Banco Santander vs. Ameriprise Financial | Banco Santander vs. Capital One Financial |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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