Correlation Between Bank of America and Coinbase Wrapped
Can any of the company-specific risk be diversified away by investing in both Bank of America and Coinbase Wrapped 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 Coinbase Wrapped 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 Coinbase Wrapped Staked, you can compare the effects of market volatilities on Bank of America and Coinbase Wrapped 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 Coinbase Wrapped. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Coinbase Wrapped.
Diversification Opportunities for Bank of America and Coinbase Wrapped
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bank and Coinbase is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Coinbase Wrapped Staked in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coinbase Wrapped Staked 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 Coinbase Wrapped. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coinbase Wrapped Staked has no effect on the direction of Bank of America i.e., Bank of America and Coinbase Wrapped go up and down completely randomly.
Pair Corralation between Bank of America and Coinbase Wrapped
Considering the 90-day investment horizon Bank of America is expected to generate 2.72 times less return on investment than Coinbase Wrapped. But when comparing it to its historical volatility, Bank of America is 2.36 times less risky than Coinbase Wrapped. It trades about 0.27 of its potential returns per unit of risk. Coinbase Wrapped Staked is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 287,189 in Coinbase Wrapped Staked on August 30, 2024 and sell it today you would earn a total of 101,700 from holding Coinbase Wrapped Staked or generate 35.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. Coinbase Wrapped Staked
Performance |
| Timeline |
| Bank of America |
| Coinbase Wrapped Staked |
Bank of America and Coinbase Wrapped Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Coinbase Wrapped
The main advantage of trading using opposite Bank of America and Coinbase Wrapped positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Coinbase Wrapped 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 Coinbase Wrapped will offset losses from the drop in Coinbase Wrapped's long position.| Bank of America vs. Citigroup | Bank of America vs. Wells Fargo | Bank of America vs. Royal Bank of | Bank of America vs. Nu Holdings |
| Coinbase Wrapped vs. XRP | Coinbase Wrapped vs. Solana | Coinbase Wrapped vs. Staked Ether | Coinbase Wrapped vs. Sui |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |