Correlation Between Banco Santander and Schoeller Bleckmann
Can any of the company-specific risk be diversified away by investing in both Banco Santander and Schoeller Bleckmann 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 Schoeller Bleckmann 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 Schoeller Bleckmann Oilfield Equipment, you can compare the effects of market volatilities on Banco Santander and Schoeller Bleckmann 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 Schoeller Bleckmann. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and Schoeller Bleckmann.
Diversification Opportunities for Banco Santander and Schoeller Bleckmann
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Banco and Schoeller is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander SA and Schoeller Bleckmann Oilfield E in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schoeller Bleckmann 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 Schoeller Bleckmann. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schoeller Bleckmann has no effect on the direction of Banco Santander i.e., Banco Santander and Schoeller Bleckmann go up and down completely randomly.
Pair Corralation between Banco Santander and Schoeller Bleckmann
Assuming the 90 days trading horizon Banco Santander SA is expected to generate 0.69 times more return on investment than Schoeller Bleckmann. However, Banco Santander SA is 1.46 times less risky than Schoeller Bleckmann. It trades about -0.02 of its potential returns per unit of risk. Schoeller Bleckmann Oilfield Equipment is currently generating about -0.09 per unit of risk. If you would invest 461.00 in Banco Santander SA on February 4, 2024 and sell it today you would lose (4.00) from holding Banco Santander SA or give up 0.87% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Banco Santander SA vs. Schoeller Bleckmann Oilfield E
Performance |
Timeline |
Banco Santander SA |
Schoeller Bleckmann |
Banco Santander and Schoeller Bleckmann Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Banco Santander and Schoeller Bleckmann
The main advantage of trading using opposite Banco Santander and Schoeller Bleckmann positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, Schoeller Bleckmann 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 Schoeller Bleckmann will offset losses from the drop in Schoeller Bleckmann's long position.Banco Santander vs. CNH Industrial NV | Banco Santander vs. SW Umwelttechnik Stoiser | Banco Santander vs. AMAG Austria Metall | Banco Santander vs. Vienna Insurance Group |
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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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