Correlation Between Bank of America and Expat Serbia
Can any of the company-specific risk be diversified away by investing in both Bank of America and Expat Serbia 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 Expat Serbia 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 Expat Serbia Belex15, you can compare the effects of market volatilities on Bank of America and Expat Serbia 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 Expat Serbia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Expat Serbia.
Diversification Opportunities for Bank of America and Expat Serbia
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Expat is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Expat Serbia Belex15 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expat Serbia Belex15 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 Expat Serbia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expat Serbia Belex15 has no effect on the direction of Bank of America i.e., Bank of America and Expat Serbia go up and down completely randomly.
Pair Corralation between Bank of America and Expat Serbia
Considering the 90-day investment horizon Bank of America is expected to generate 0.9 times more return on investment than Expat Serbia. However, Bank of America is 1.11 times less risky than Expat Serbia. It trades about 0.08 of its potential returns per unit of risk. Expat Serbia Belex15 is currently generating about -0.02 per unit of risk. If you would invest 4,060 in Bank of America on October 26, 2024 and sell it today you would earn a total of 621.00 from holding Bank of America or generate 15.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. Expat Serbia Belex15
Performance |
| Timeline |
| Bank of America |
| Expat Serbia Belex15 |
Bank of America and Expat Serbia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Expat Serbia
The main advantage of trading using opposite Bank of America and Expat Serbia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Expat Serbia 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 Expat Serbia will offset losses from the drop in Expat Serbia's long position.| Bank of America vs. Toronto Dominion Bank | Bank of America vs. Royal Bank of | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC |
| Expat Serbia vs. Expat Czech PX | Expat Serbia vs. Expat Croatia Crobex | Expat Serbia vs. Expat Poland WIG20 | Expat Serbia vs. Expat Slovenia SBI |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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