Correlation Between Bank of America and Allianzgi Mid-cap
Can any of the company-specific risk be diversified away by investing in both Bank of America and Allianzgi Mid-cap 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 Allianzgi Mid-cap 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 Allianzgi Mid Cap Fund, you can compare the effects of market volatilities on Bank of America and Allianzgi Mid-cap 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 Allianzgi Mid-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Allianzgi Mid-cap.
Diversification Opportunities for Bank of America and Allianzgi Mid-cap
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Allianzgi is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Allianzgi Mid Cap Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Mid 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 Allianzgi Mid-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Mid Cap has no effect on the direction of Bank of America i.e., Bank of America and Allianzgi Mid-cap go up and down completely randomly.
Pair Corralation between Bank of America and Allianzgi Mid-cap
Considering the 90-day investment horizon Bank of America is expected to under-perform the Allianzgi Mid-cap. But the stock apears to be less risky and, when comparing its historical volatility, Bank of America is 1.51 times less risky than Allianzgi Mid-cap. The stock trades about -0.31 of its potential returns per unit of risk. The Allianzgi Mid Cap Fund is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 615.00 in Allianzgi Mid Cap Fund on November 27, 2024 and sell it today you would lose (18.00) from holding Allianzgi Mid Cap Fund or give up 2.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. Allianzgi Mid Cap Fund
Performance |
| Timeline |
| Bank of America |
| Allianzgi Mid Cap |
Bank of America and Allianzgi Mid-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Allianzgi Mid-cap
The main advantage of trading using opposite Bank of America and Allianzgi Mid-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Allianzgi Mid-cap 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 Allianzgi Mid-cap will offset losses from the drop in Allianzgi Mid-cap'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 |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |