Correlation Between Bank of America and Aura FAT
Can any of the company-specific risk be diversified away by investing in both Bank of America and Aura FAT at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Bank of America and Aura FAT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of America and Aura FAT Projects, you can compare the effects of market volatilities on Bank of America and Aura FAT 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 Aura FAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Aura FAT.
Diversification Opportunities for Bank of America and Aura FAT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Aura is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Aura FAT Projects in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aura FAT Projects 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 Aura FAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aura FAT Projects has no effect on the direction of Bank of America i.e., Bank of America and Aura FAT go up and down completely randomly.
Pair Corralation between Bank of America and Aura FAT
If you would invest (100.00) in Aura FAT Projects on November 28, 2024 and sell it today you would earn a total of 100.00 from holding Aura FAT Projects or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Bank of America vs. Aura FAT Projects
Performance |
| Timeline |
| Bank of America |
| Aura FAT Projects |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Bank of America and Aura FAT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Aura FAT
The main advantage of trading using opposite Bank of America and Aura FAT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Aura FAT 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 Aura FAT will offset losses from the drop in Aura FAT'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 |
| Aura FAT vs. Embrace Change Acquisition | Aura FAT vs. Denali Capital Acquisition | Aura FAT vs. Aimfinity Investment I |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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