Correlation Between Banco Santander and New Residential
Can any of the company-specific risk be diversified away by investing in both Banco Santander and New Residential 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 New Residential 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 New Residential Investment, you can compare the effects of market volatilities on Banco Santander and New Residential 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 New Residential. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and New Residential.
Diversification Opportunities for Banco Santander and New Residential
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Banco and New is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander SA and New Residential Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Residential Inve 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 New Residential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Residential Inve has no effect on the direction of Banco Santander i.e., Banco Santander and New Residential go up and down completely randomly.
Pair Corralation between Banco Santander and New Residential
Assuming the 90 days trading horizon Banco Santander SA is expected to generate 1.48 times more return on investment than New Residential. However, Banco Santander is 1.48 times more volatile than New Residential Investment. It trades about 0.39 of its potential returns per unit of risk. New Residential Investment is currently generating about 0.17 per unit of risk. If you would invest 488.00 in Banco Santander SA on September 1, 2025 and sell it today you would earn a total of 72.00 from holding Banco Santander SA or generate 14.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banco Santander SA vs. New Residential Investment
Performance |
| Timeline |
| Banco Santander SA |
| New Residential Inve |
Banco Santander and New Residential Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banco Santander and New Residential
The main advantage of trading using opposite Banco Santander and New Residential positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, New Residential 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 New Residential will offset losses from the drop in New Residential's long position.| Banco Santander vs. Suntory Beverage Food | Banco Santander vs. China Resources Beer | Banco Santander vs. National Beverage Corp | Banco Santander vs. BOSTON BEER A |
| New Residential vs. COMM HEALTH SYSTEMS | New Residential vs. Chesapeake Utilities | New Residential vs. Banco Santander SA | New Residential vs. Hellenic Telecommunications Organization |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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