Correlation Between Bank of America and Jafron Biomedical
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By analyzing existing cross correlation between Bank of America and Jafron Biomedical Co, you can compare the effects of market volatilities on Bank of America and Jafron Biomedical 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 Jafron Biomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Jafron Biomedical.
Diversification Opportunities for Bank of America and Jafron Biomedical
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Jafron is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Jafron Biomedical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jafron Biomedical 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 Jafron Biomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jafron Biomedical has no effect on the direction of Bank of America i.e., Bank of America and Jafron Biomedical go up and down completely randomly.
Pair Corralation between Bank of America and Jafron Biomedical
Considering the 90-day investment horizon Bank of America is expected to generate 0.88 times more return on investment than Jafron Biomedical. However, Bank of America is 1.13 times less risky than Jafron Biomedical. It trades about 0.35 of its potential returns per unit of risk. Jafron Biomedical Co is currently generating about -0.05 per unit of risk. If you would invest 4,133 in Bank of America on September 3, 2024 and sell it today you would earn a total of 618.00 from holding Bank of America or generate 14.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Bank of America vs. Jafron Biomedical Co
Performance |
| Timeline |
| Bank of America |
| Jafron Biomedical |
Bank of America and Jafron Biomedical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Jafron Biomedical
The main advantage of trading using opposite Bank of America and Jafron Biomedical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Jafron Biomedical 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 Jafron Biomedical will offset losses from the drop in Jafron Biomedical's long position.| Bank of America vs. Partner Communications | Bank of America vs. Merck Company | Bank of America vs. Western Midstream Partners | Bank of America vs. Edgewise Therapeutics |
| Jafron Biomedical vs. Chengdu Kanghua Biological | Jafron Biomedical vs. Beijing Wantai Biological | Jafron Biomedical vs. Suzhou Novoprotein Scientific | Jafron Biomedical vs. Aluminum Corp of |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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