Correlation Between Bank of America and CoreShares TotalWldStock
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By analyzing existing cross correlation between Bank of America and CoreShares TotalWldStock ETF, you can compare the effects of market volatilities on Bank of America and CoreShares TotalWldStock 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 CoreShares TotalWldStock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and CoreShares TotalWldStock.
Diversification Opportunities for Bank of America and CoreShares TotalWldStock
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and CoreShares is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and CoreShares TotalWldStock ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CoreShares TotalWldStock 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 CoreShares TotalWldStock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CoreShares TotalWldStock has no effect on the direction of Bank of America i.e., Bank of America and CoreShares TotalWldStock go up and down completely randomly.
Pair Corralation between Bank of America and CoreShares TotalWldStock
Considering the 90-day investment horizon Bank of America is expected to generate 1.86 times more return on investment than CoreShares TotalWldStock. However, Bank of America is 1.86 times more volatile than CoreShares TotalWldStock ETF. It trades about 0.24 of its potential returns per unit of risk. CoreShares TotalWldStock ETF is currently generating about 0.14 per unit of risk. If you would invest 4,262 in Bank of America on August 27, 2024 and sell it today you would earn a total of 438.00 from holding Bank of America or generate 10.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. CoreShares TotalWldStock ETF
Performance |
| Timeline |
| Bank of America |
| CoreShares TotalWldStock |
Bank of America and CoreShares TotalWldStock Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and CoreShares TotalWldStock
The main advantage of trading using opposite Bank of America and CoreShares TotalWldStock positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, CoreShares TotalWldStock 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 CoreShares TotalWldStock will offset losses from the drop in CoreShares TotalWldStock's long position.| Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Montreal | Bank of America vs. Bank of Nova |
| CoreShares TotalWldStock vs. Europa Metals | CoreShares TotalWldStock vs. British American Tobacco | CoreShares TotalWldStock vs. Kap Industrial Holdings | CoreShares TotalWldStock vs. Anglo American Platinum |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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