Correlation Between Bank of America and Xinke Material
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By analyzing existing cross correlation between Bank of America and Xinke Material, you can compare the effects of market volatilities on Bank of America and Xinke Material 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 Xinke Material. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Xinke Material.
Diversification Opportunities for Bank of America and Xinke Material
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Xinke is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Xinke Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinke Material 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 Xinke Material. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinke Material has no effect on the direction of Bank of America i.e., Bank of America and Xinke Material go up and down completely randomly.
Pair Corralation between Bank of America and Xinke Material
Considering the 90-day investment horizon Bank of America is expected to generate 0.65 times more return on investment than Xinke Material. However, Bank of America is 1.53 times less risky than Xinke Material. It trades about 0.06 of its potential returns per unit of risk. Xinke Material is currently generating about 0.0 per unit of risk. If you would invest 3,085 in Bank of America on August 29, 2024 and sell it today you would earn a total of 1,690 from holding Bank of America or generate 54.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 96.16% |
| Values | Daily Returns |
Bank of America vs. Xinke Material
Performance |
| Timeline |
| Bank of America |
| Xinke Material |
Bank of America and Xinke Material Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Xinke Material
The main advantage of trading using opposite Bank of America and Xinke Material positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Xinke Material 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 Xinke Material will offset losses from the drop in Xinke Material's long position.| Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Nova |
| Xinke Material vs. Wanhua Chemical Group | Xinke Material vs. Shandong Gold Mining | Xinke Material vs. Rongsheng Petrochemical Co | Xinke Material vs. Inner Mongolia BaoTou |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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