Correlation Between Bank of America and Konya Cimento
Can any of the company-specific risk be diversified away by investing in both Bank of America and Konya Cimento 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 Konya Cimento 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 Konya Cimento Sanayi, you can compare the effects of market volatilities on Bank of America and Konya Cimento 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 Konya Cimento. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Konya Cimento.
Diversification Opportunities for Bank of America and Konya Cimento
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Konya is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Konya Cimento Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Konya Cimento Sanayi 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 Konya Cimento. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Konya Cimento Sanayi has no effect on the direction of Bank of America i.e., Bank of America and Konya Cimento go up and down completely randomly.
Pair Corralation between Bank of America and Konya Cimento
Considering the 90-day investment horizon Bank of America is expected to generate 0.61 times more return on investment than Konya Cimento. However, Bank of America is 1.64 times less risky than Konya Cimento. It trades about 0.12 of its potential returns per unit of risk. Konya Cimento Sanayi is currently generating about -0.06 per unit of risk. If you would invest 3,815 in Bank of America on August 28, 2024 and sell it today you would earn a total of 935.00 from holding Bank of America or generate 24.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.62% |
| Values | Daily Returns |
Bank of America vs. Konya Cimento Sanayi
Performance |
| Timeline |
| Bank of America |
| Konya Cimento Sanayi |
Bank of America and Konya Cimento Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Konya Cimento
The main advantage of trading using opposite Bank of America and Konya Cimento positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Konya Cimento 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 Konya Cimento will offset losses from the drop in Konya Cimento's long position.| Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Nova |
| Konya Cimento vs. Qnb Finansbank AS | Konya Cimento vs. QNB Finans Finansal | Konya Cimento vs. Turkiye Kalkinma Bankasi | Konya Cimento vs. Kocaer Celik Sanayi |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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