Correlation Between Bank of America and Guerrilla
Can any of the company-specific risk be diversified away by investing in both Bank of America and Guerrilla 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 Guerrilla 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 Guerrilla RF, you can compare the effects of market volatilities on Bank of America and Guerrilla 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 Guerrilla. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Guerrilla.
Diversification Opportunities for Bank of America and Guerrilla
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Guerrilla is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Guerrilla RF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guerrilla RF 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 Guerrilla. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guerrilla RF has no effect on the direction of Bank of America i.e., Bank of America and Guerrilla go up and down completely randomly.
Pair Corralation between Bank of America and Guerrilla
Considering the 90-day investment horizon Bank of America is expected to generate 0.21 times more return on investment than Guerrilla. However, Bank of America is 4.8 times less risky than Guerrilla. It trades about 0.22 of its potential returns per unit of risk. Guerrilla RF is currently generating about -0.38 per unit of risk. If you would invest 4,265 in Bank of America on August 25, 2024 and sell it today you would earn a total of 435.00 from holding Bank of America or generate 10.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. Guerrilla RF
Performance |
| Timeline |
| Bank of America |
| Guerrilla RF |
Bank of America and Guerrilla Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Guerrilla
The main advantage of trading using opposite Bank of America and Guerrilla positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Guerrilla 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 Guerrilla will offset losses from the drop in Guerrilla'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. Canadian Imperial Bank |
| Guerrilla vs. ams AG | Guerrilla vs. Odyssey Semiconductor Technologies | Guerrilla vs. Archer Materials Limited | Guerrilla vs. Alphawave IP Group |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |