Correlation Between Bank of America and Greenshift Corp
Can any of the company-specific risk be diversified away by investing in both Bank of America and Greenshift Corp 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 Greenshift Corp 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 Greenshift Corp, you can compare the effects of market volatilities on Bank of America and Greenshift Corp 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 Greenshift Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Greenshift Corp.
Diversification Opportunities for Bank of America and Greenshift Corp
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Greenshift is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Greenshift Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenshift Corp 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 Greenshift Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenshift Corp has no effect on the direction of Bank of America i.e., Bank of America and Greenshift Corp go up and down completely randomly.
Pair Corralation between Bank of America and Greenshift Corp
Considering the 90-day investment horizon Bank of America is expected to under-perform the Greenshift Corp. But the stock apears to be less risky and, when comparing its historical volatility, Bank of America is 1.39 times less risky than Greenshift Corp. The stock trades about -0.11 of its potential returns per unit of risk. The Greenshift Corp is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 3.60 in Greenshift Corp on January 16, 2025 and sell it today you would earn a total of 1.40 from holding Greenshift Corp or generate 38.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bank of America vs. Greenshift Corp
Performance |
| Timeline |
| Bank of America |
| Greenshift Corp |
Bank of America and Greenshift Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Greenshift Corp
The main advantage of trading using opposite Bank of America and Greenshift Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Greenshift Corp 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 Greenshift Corp will offset losses from the drop in Greenshift Corp's long position.| Bank of America vs. Ameritrans Capital Corp | Bank of America vs. MicroAlgo | Bank of America vs. Summa Silver Corp | Bank of America vs. Invesco California Value |
| Greenshift Corp vs. Agnico Eagle Mines | Greenshift Corp vs. Osisko Gold Ro | Greenshift Corp vs. Gold Fields Ltd | Greenshift Corp vs. AngloGold Ashanti plc |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |