Correlation Between Bank of America and Hainan HNA
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By analyzing existing cross correlation between Bank of America and Hainan HNA Infrastructure, you can compare the effects of market volatilities on Bank of America and Hainan HNA 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 Hainan HNA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Hainan HNA.
Diversification Opportunities for Bank of America and Hainan HNA
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Hainan is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Hainan HNA Infrastructure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan HNA Infrastructure 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 Hainan HNA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan HNA Infrastructure has no effect on the direction of Bank of America i.e., Bank of America and Hainan HNA go up and down completely randomly.
Pair Corralation between Bank of America and Hainan HNA
Considering the 90-day investment horizon Bank of America is expected to generate 0.88 times more return on investment than Hainan HNA. However, Bank of America is 1.14 times less risky than Hainan HNA. It trades about 0.05 of its potential returns per unit of risk. Hainan HNA Infrastructure is currently generating about -0.01 per unit of risk. If you would invest 3,278 in Bank of America on August 24, 2024 and sell it today you would earn a total of 1,422 from holding Bank of America or generate 43.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.17% |
| Values | Daily Returns |
Bank of America vs. Hainan HNA Infrastructure
Performance |
| Timeline |
| Bank of America |
| Hainan HNA Infrastructure |
Bank of America and Hainan HNA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Hainan HNA
The main advantage of trading using opposite Bank of America and Hainan HNA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Hainan HNA 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 Hainan HNA will offset losses from the drop in Hainan HNA's long position.| Bank of America vs. Amtech Systems | Bank of America vs. Gold Fields Ltd | Bank of America vs. Aegean Airlines SA | Bank of America vs. Merck Company |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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