Correlation Between Bank of America and Scotiabank Peru
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By analyzing existing cross correlation between Bank of America and Scotiabank Peru SAA, you can compare the effects of market volatilities on Bank of America and Scotiabank Peru 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 Bank of America with a short position of Scotiabank Peru. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Scotiabank Peru.
Diversification Opportunities for Bank of America and Scotiabank Peru
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Scotiabank is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Scotiabank Peru SAA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scotiabank Peru SAA and Bank of America 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 Bank of America are associated (or correlated) with Scotiabank Peru. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scotiabank Peru SAA has no effect on the direction of Bank of America i.e., Bank of America and Scotiabank Peru go up and down completely randomly.
Pair Corralation between Bank of America and Scotiabank Peru
If you would invest 4,250 in Bank of America on August 28, 2024 and sell it today you would earn a total of 490.00 from holding Bank of America or generate 11.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 30.0% |
| Values | Daily Returns |
Bank of America vs. Scotiabank Peru SAA
Performance |
| Timeline |
| Bank of America |
| Scotiabank Peru SAA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Strong
Bank of America and Scotiabank Peru Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Scotiabank Peru
The main advantage of trading using opposite Bank of America and Scotiabank Peru positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Scotiabank Peru 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 Scotiabank Peru will offset losses from the drop in Scotiabank Peru's long position.The idea behind Bank of America and Scotiabank Peru SAA 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.| Scotiabank Peru vs. Corporacion Aceros Arequipa | Scotiabank Peru vs. Banco Internacional del | Scotiabank Peru vs. Sociedad Minera el |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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