Correlation Between CI Games and Santander Bank

Can any of the company-specific risk be diversified away by investing in both CI Games and Santander Bank 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 CI Games and Santander Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CI Games SA and Santander Bank Polska, you can compare the effects of market volatilities on CI Games and Santander Bank 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 CI Games with a short position of Santander Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of CI Games and Santander Bank.

Diversification Opportunities for CI Games and Santander Bank

0.72

Correlation Coefficient

CI Games  Santander Bank

Poor diversification

The 3 months correlation between CIG and Santander is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding CI Games SA and Santander Bank Polska in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Santander Bank Polska and CI Games 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 CI Games SA are associated (or correlated) with Santander Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Santander Bank Polska has no effect on the direction of CI Games i.e., CI Games and Santander Bank go up and down completely randomly.

Pair Corralation between CI Games and Santander Bank

Assuming the 90 days trading horizon CI Games SA is expected to generate 1.19 times more return on investment than Santander Bank. However, CI Games is 1.19 times more volatile than Santander Bank Polska. It trades about 0.2 of its potential returns per unit of risk. Santander Bank Polska is currently generating about 0.19 per unit of risk. If you would invest  130.00  in CI Games SA on December 30, 2024 and sell it today you would earn a total of  40.00  from holding CI Games SA or generate 30.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

CI Games SA  vs.  Santander Bank Polska

CI Games SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CI Games SA are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, CI Games reported solid returns over the last few months and may actually be approaching a breakup point.

Santander Bank Polska

Risk-Adjusted Performance

Good

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

Pair Trading with CI Games and Santander Bank

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

The idea behind CI Games SA and Santander Bank Polska 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.