Correlation Between Bank of America and Hunan Tyen
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By analyzing existing cross correlation between Bank of America and Hunan Tyen Machinery, you can compare the effects of market volatilities on Bank of America and Hunan Tyen 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 Hunan Tyen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Hunan Tyen.
Diversification Opportunities for Bank of America and Hunan Tyen
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Hunan is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Hunan Tyen Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunan Tyen Machinery 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 Hunan Tyen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunan Tyen Machinery has no effect on the direction of Bank of America i.e., Bank of America and Hunan Tyen go up and down completely randomly.
Pair Corralation between Bank of America and Hunan Tyen
Considering the 90-day investment horizon Bank of America is expected to generate 0.54 times more return on investment than Hunan Tyen. However, Bank of America is 1.85 times less risky than Hunan Tyen. It trades about 0.05 of its potential returns per unit of risk. Hunan Tyen Machinery is currently generating about 0.01 per unit of risk. If you would invest 3,278 in Bank of America on August 25, 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 | 96.18% |
| Values | Daily Returns |
Bank of America vs. Hunan Tyen Machinery
Performance |
| Timeline |
| Bank of America |
| Hunan Tyen Machinery |
Bank of America and Hunan Tyen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Hunan Tyen
The main advantage of trading using opposite Bank of America and Hunan Tyen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Hunan Tyen 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 Hunan Tyen will offset losses from the drop in Hunan Tyen's long position.| Bank of America vs. Toronto Dominion Bank | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Montreal |
| Hunan Tyen vs. Jinling Hotel Corp | Hunan Tyen vs. BTG Hotels Group | Hunan Tyen vs. Epoxy Base Electronic | Hunan Tyen vs. Fiberhome Telecommunication Technologies |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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