Correlation Between Bank of America and Bank Mayapada
Can any of the company-specific risk be diversified away by investing in both Bank of America and Bank Mayapada 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 Bank Mayapada 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 Bank Mayapada Internasional, you can compare the effects of market volatilities on Bank of America and Bank Mayapada 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 Bank Mayapada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Bank Mayapada.
Diversification Opportunities for Bank of America and Bank Mayapada
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Bank is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Bank Mayapada Internasional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Mayapada Intern 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 Bank Mayapada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Mayapada Intern has no effect on the direction of Bank of America i.e., Bank of America and Bank Mayapada go up and down completely randomly.
Pair Corralation between Bank of America and Bank Mayapada
Considering the 90-day investment horizon Bank of America is expected to generate 1.36 times less return on investment than Bank Mayapada. But when comparing it to its historical volatility, Bank of America is 4.22 times less risky than Bank Mayapada. It trades about 0.29 of its potential returns per unit of risk. Bank Mayapada Internasional is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 22,200 in Bank Mayapada Internasional on August 31, 2024 and sell it today you would earn a total of 2,400 from holding Bank Mayapada Internasional or generate 10.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bank of America vs. Bank Mayapada Internasional
Performance |
| Timeline |
| Bank of America |
| Bank Mayapada Intern |
Bank of America and Bank Mayapada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Bank Mayapada
The main advantage of trading using opposite Bank of America and Bank Mayapada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Bank Mayapada 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 Bank Mayapada will offset losses from the drop in Bank Mayapada's long position.| Bank of America vs. RLJ Lodging Trust | Bank of America vs. Aquagold International | Bank of America vs. Stepstone Group | Bank of America vs. Morningstar Unconstrained Allocation |
| Bank Mayapada vs. Bank Mega Tbk | Bank Mayapada vs. Bank Ocbc Nisp | Bank Mayapada vs. Bank Windu Kentjana | Bank Mayapada vs. Bank Artha Graha |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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