Correlation Between Bank of America and Nippon Life
Specify exactly 2 symbols:
By analyzing existing cross correlation between Bank of America and Nippon Life India, you can compare the effects of market volatilities on Bank of America and Nippon Life 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 Nippon Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Nippon Life.
Diversification Opportunities for Bank of America and Nippon Life
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Nippon is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Nippon Life India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nippon Life India 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 Nippon Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nippon Life India has no effect on the direction of Bank of America i.e., Bank of America and Nippon Life go up and down completely randomly.
Pair Corralation between Bank of America and Nippon Life
Considering the 90-day investment horizon Bank of America is expected to generate 1.04 times more return on investment than Nippon Life. However, Bank of America is 1.04 times more volatile than Nippon Life India. It trades about 0.27 of its potential returns per unit of risk. Nippon Life India is currently generating about 0.13 per unit of risk. If you would invest 4,253 in Bank of America on August 30, 2024 and sell it today you would earn a total of 524.00 from holding Bank of America or generate 12.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bank of America vs. Nippon Life India
Performance |
| Timeline |
| Bank of America |
| Nippon Life India |
Bank of America and Nippon Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Nippon Life
The main advantage of trading using opposite Bank of America and Nippon Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Nippon Life 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 Nippon Life will offset losses from the drop in Nippon Life's long position.| Bank of America vs. Citigroup | Bank of America vs. Wells Fargo | Bank of America vs. Royal Bank of | Bank of America vs. Nu Holdings |
| Nippon Life vs. ADF Foods Limited | Nippon Life vs. Pondy Oxides Chemicals | Nippon Life vs. Dharani SugarsChemicals Limited | Nippon Life vs. Zuari Agro Chemicals |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |