Correlation Between Banco Santander and CCC SA

Can any of the company-specific risk be diversified away by investing in both Banco Santander and CCC SA 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 CCC SA 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 CCC SA, you can compare the effects of market volatilities on Banco Santander and CCC SA 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 CCC SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banco Santander and CCC SA.

Diversification Opportunities for Banco Santander and CCC SA

-0.51

Correlation Coefficient

Banco Santander  CCC SA

Excellent diversification

The 3 months correlation between Banco and CCC is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Banco Santander SA and CCC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCC SA 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 CCC SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCC SA has no effect on the direction of Banco Santander i.e., Banco Santander and CCC SA go up and down completely randomly.

Pair Corralation between Banco Santander and CCC SA

Assuming the 90 days trading horizon Banco Santander SA is expected to generate 0.56 times more return on investment than CCC SA. However, Banco Santander SA is 1.78 times less risky than CCC SA. It trades about 0.18 of its potential returns per unit of risk. CCC SA is currently generating about -0.03 per unit of risk. If you would invest  2,540  in Banco Santander SA on April 22, 2025 and sell it today you would earn a total of  510.00  from holding Banco Santander SA or generate 20.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Banco Santander SA  vs.  CCC SA

Banco Santander SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Banco Santander SA are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Banco Santander reported solid returns over the last few months and may actually be approaching a breakup point.

CCC SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days CCC SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, CCC SA is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Banco Santander and CCC SA

The main advantage of trading using opposite Banco Santander and CCC SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banco Santander position performs unexpectedly, CCC SA 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 CCC SA will offset losses from the drop in CCC SA's long position.

The idea behind Banco Santander SA and CCC SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.