Correlation Between Bank of America and Doubleline Long
Can any of the company-specific risk be diversified away by investing in both Bank of America and Doubleline Long 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 Doubleline Long 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 Doubleline Long Duration, you can compare the effects of market volatilities on Bank of America and Doubleline Long 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 Doubleline Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Doubleline Long.
Diversification Opportunities for Bank of America and Doubleline Long
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Doubleline is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Doubleline Long Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Long Duration 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 Doubleline Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Long Duration has no effect on the direction of Bank of America i.e., Bank of America and Doubleline Long go up and down completely randomly.
Pair Corralation between Bank of America and Doubleline Long
Considering the 90-day investment horizon Bank of America is expected to generate 1.82 times more return on investment than Doubleline Long. However, Bank of America is 1.82 times more volatile than Doubleline Long Duration. It trades about 0.12 of its potential returns per unit of risk. Doubleline Long Duration is currently generating about 0.02 per unit of risk. If you would invest 3,495 in Bank of America on September 1, 2024 and sell it today you would earn a total of 1,256 from holding Bank of America or generate 35.94% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 99.47% |
Values | Daily Returns |
Bank of America vs. Doubleline Long Duration
Performance |
Timeline |
Bank of America |
Doubleline Long Duration |
Bank of America and Doubleline Long Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank of America and Doubleline Long
The main advantage of trading using opposite Bank of America and Doubleline Long positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Doubleline Long 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 Doubleline Long will offset losses from the drop in Doubleline Long's long position.Bank of America vs. Citigroup | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Montreal |
Doubleline Long vs. Strategic Allocation Aggressive | Doubleline Long vs. Lgm Risk Managed | Doubleline Long vs. T Rowe Price | Doubleline Long vs. Alliancebernstein Global High |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation |