Correlation Between Bank of America and A Zenith
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By analyzing existing cross correlation between Bank of America and A Zenith Home Furnishings, you can compare the effects of market volatilities on Bank of America and A Zenith 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 A Zenith. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and A Zenith.
Diversification Opportunities for Bank of America and A Zenith
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and 603389 is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and A Zenith Home Furnishings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A Zenith Home 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 A Zenith. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A Zenith Home has no effect on the direction of Bank of America i.e., Bank of America and A Zenith go up and down completely randomly.
Pair Corralation between Bank of America and A Zenith
Considering the 90-day investment horizon Bank of America is expected to generate 0.63 times more return on investment than A Zenith. However, Bank of America is 1.58 times less risky than A Zenith. It trades about 0.27 of its potential returns per unit of risk. A Zenith Home Furnishings is currently generating about -0.07 per unit of risk. If you would invest 4,231 in Bank of America on August 31, 2024 and sell it today you would earn a total of 520.00 from holding Bank of America or generate 12.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. A Zenith Home Furnishings
Performance |
| Timeline |
| Bank of America |
| A Zenith Home |
Bank of America and A Zenith Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and A Zenith
The main advantage of trading using opposite Bank of America and A Zenith positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, A Zenith 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 A Zenith will offset losses from the drop in A Zenith's long position.| Bank of America vs. Citigroup | Bank of America vs. Wells Fargo | Bank of America vs. Toronto Dominion Bank | Bank of America vs. Royal Bank of |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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