Correlation Between Bank of America and Cognios Large
Can any of the company-specific risk be diversified away by investing in both Bank of America and Cognios Large 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 Cognios Large 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 Cognios Large Cap, you can compare the effects of market volatilities on Bank of America and Cognios Large 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 Cognios Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Cognios Large.
Diversification Opportunities for Bank of America and Cognios Large
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Cognios is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Cognios Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cognios Large Cap 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 Cognios Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cognios Large Cap has no effect on the direction of Bank of America i.e., Bank of America and Cognios Large go up and down completely randomly.
Pair Corralation between Bank of America and Cognios Large
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 | Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Bank of America vs. Cognios Large Cap
Performance |
| Timeline |
| Bank of America |
| Cognios Large Cap |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Bank of America and Cognios Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Cognios Large
The main advantage of trading using opposite Bank of America and Cognios Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Cognios Large 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 Cognios Large will offset losses from the drop in Cognios Large'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 |
| Cognios Large vs. Schwartz Value Focused | Cognios Large vs. Centre American Select | Cognios Large vs. Dreyfus Natural Resources | Cognios Large vs. Kinetics Small Cap |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |