Correlation Between Bank of America and Jamf Holding
Can any of the company-specific risk be diversified away by investing in both Bank of America and Jamf Holding 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 Jamf Holding 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 Jamf Holding, you can compare the effects of market volatilities on Bank of America and Jamf Holding 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 Jamf Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Jamf Holding.
Diversification Opportunities for Bank of America and Jamf Holding
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bank and Jamf is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Jamf Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jamf Holding 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 Jamf Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jamf Holding has no effect on the direction of Bank of America i.e., Bank of America and Jamf Holding go up and down completely randomly.
Pair Corralation between Bank of America and Jamf Holding
Considering the 90-day investment horizon Bank of America is expected to generate 1.09 times more return on investment than Jamf Holding. However, Bank of America is 1.09 times more volatile than Jamf Holding. It trades about -0.2 of its potential returns per unit of risk. Jamf Holding is currently generating about -0.28 per unit of risk. If you would invest 3,983 in Bank of America on January 7, 2025 and sell it today you would lose (544.00) from holding Bank of America or give up 13.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. Jamf Holding
Performance |
| Timeline |
| Bank of America |
| Jamf Holding |
Bank of America and Jamf Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Jamf Holding
The main advantage of trading using opposite Bank of America and Jamf Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Jamf Holding 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 Jamf Holding will offset losses from the drop in Jamf Holding's long position.| Bank of America vs. Citigroup | Bank of America vs. Wells Fargo | Bank of America vs. Toronto Dominion Bank | Bank of America vs. Royal Bank of |
| Jamf Holding vs. Paycor HCM | Jamf Holding vs. Enfusion | Jamf Holding vs. E2open Parent Holdings | Jamf Holding vs. Pegasystems |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |