Correlation Between Bank of America and Gabelli Dividend
Can any of the company-specific risk be diversified away by investing in both Bank of America and Gabelli Dividend 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 Gabelli Dividend 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 The Gabelli Dividend, you can compare the effects of market volatilities on Bank of America and Gabelli Dividend 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 Gabelli Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Gabelli Dividend.
Diversification Opportunities for Bank of America and Gabelli Dividend
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Gabelli is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and The Gabelli Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gabelli Dividend 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 Gabelli Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gabelli Dividend has no effect on the direction of Bank of America i.e., Bank of America and Gabelli Dividend go up and down completely randomly.
Pair Corralation between Bank of America and Gabelli Dividend
Considering the 90-day investment horizon Bank of America is expected to generate 2.95 times more return on investment than Gabelli Dividend. However, Bank of America is 2.95 times more volatile than The Gabelli Dividend. It trades about 0.1 of its potential returns per unit of risk. The Gabelli Dividend is currently generating about 0.17 per unit of risk. If you would invest 3,883 in Bank of America on August 25, 2024 and sell it today you would earn a total of 817.00 from holding Bank of America or generate 21.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. The Gabelli Dividend
Performance |
| Timeline |
| Bank of America |
| Gabelli Dividend |
Bank of America and Gabelli Dividend Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Gabelli Dividend
The main advantage of trading using opposite Bank of America and Gabelli Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Gabelli Dividend 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 Gabelli Dividend will offset losses from the drop in Gabelli Dividend's long position.| Bank of America vs. Toronto Dominion Bank | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Montreal |
| Gabelli Dividend vs. The Gabelli Multimedia | Gabelli Dividend vs. The Gabelli Equity | Gabelli Dividend vs. The Gabelli Multimedia | Gabelli Dividend vs. The Gabelli Dividend |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |