Correlation Between Bank of America and Calamos High
Can any of the company-specific risk be diversified away by investing in both Bank of America and Calamos High 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 Calamos High 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 Calamos High Income, you can compare the effects of market volatilities on Bank of America and Calamos High 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 Calamos High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Calamos High.
Diversification Opportunities for Bank of America and Calamos High
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Calamos is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Calamos High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos High Income 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 Calamos High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos High Income has no effect on the direction of Bank of America i.e., Bank of America and Calamos High go up and down completely randomly.
Pair Corralation between Bank of America and Calamos High
Considering the 90-day investment horizon Bank of America is expected to generate 17.2 times more return on investment than Calamos High. However, Bank of America is 17.2 times more volatile than Calamos High Income. It trades about 0.27 of its potential returns per unit of risk. Calamos High Income is currently generating about 0.36 per unit of risk. If you would invest 4,262 in Bank of America on August 29, 2024 and sell it today you would earn a total of 523.50 from holding Bank of America or generate 12.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bank of America vs. Calamos High Income
Performance |
| Timeline |
| Bank of America |
| Calamos High Income |
Bank of America and Calamos High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Calamos High
The main advantage of trading using opposite Bank of America and Calamos High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Calamos High 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 Calamos High will offset losses from the drop in Calamos High'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. JPMorgan Chase Co |
| Calamos High vs. Dreyfus Technology Growth | Calamos High vs. Allianzgi Technology Fund | Calamos High vs. Blackrock Science Technology | Calamos High vs. Technology Ultrasector Profund |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |