Correlation Between Amundi Treasury and SANTANDER

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

By analyzing existing cross correlation between Amundi Treasury Bond and SANTANDER UK 10, you can compare the effects of market volatilities on Amundi Treasury and 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 Amundi Treasury with a short position of SANTANDER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi Treasury and SANTANDER.

Diversification Opportunities for Amundi Treasury and SANTANDER

-0.59

Correlation Coefficient

Amundi Treasury  SANTANDER

Excellent diversification

The 3 months correlation between Amundi and SANTANDER is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Amundi Treasury Bond and SANTANDER UK 10 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANTANDER UK 10 and Amundi Treasury 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 Amundi Treasury Bond are associated (or correlated) with SANTANDER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANTANDER UK 10 has no effect on the direction of Amundi Treasury i.e., Amundi Treasury and SANTANDER go up and down completely randomly.

Pair Corralation between Amundi Treasury and SANTANDER

Assuming the 90 days trading horizon Amundi Treasury Bond is expected to under-perform the SANTANDER. In addition to that, Amundi Treasury is 2.64 times more volatile than SANTANDER UK 10. It trades about -0.11 of its total potential returns per unit of risk. SANTANDER UK 10 is currently generating about 0.0 per unit of volatility. If you would invest  15,640  in SANTANDER UK 10 on September 6, 2024 and sell it today you would earn a total of  0.00  from holding SANTANDER UK 10 or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.46%
Values	Daily Returns

Amundi Treasury Bond  vs.  SANTANDER UK 10

Amundi Treasury Bond

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amundi Treasury Bond has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Amundi Treasury is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

SANTANDER UK 10

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SANTANDER UK 10 has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, SANTANDER is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Amundi Treasury and SANTANDER

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

The idea behind Amundi Treasury Bond and SANTANDER UK 10 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.