Correlation Between Bank of America and Nutriband
Can any of the company-specific risk be diversified away by investing in both Bank of America and Nutriband 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 Nutriband 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 Nutriband, you can compare the effects of market volatilities on Bank of America and Nutriband 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 Nutriband. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Nutriband.
Diversification Opportunities for Bank of America and Nutriband
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and Nutriband is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Nutriband in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nutriband 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 Nutriband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nutriband has no effect on the direction of Bank of America i.e., Bank of America and Nutriband go up and down completely randomly.
Pair Corralation between Bank of America and Nutriband
Considering the 90-day investment horizon Bank of America is expected to generate 2.34 times less return on investment than Nutriband. But when comparing it to its historical volatility, Bank of America is 4.54 times less risky than Nutriband. It trades about 0.14 of its potential returns per unit of risk. Nutriband is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 251.00 in Nutriband on August 24, 2024 and sell it today you would earn a total of 243.00 from holding Nutriband or generate 96.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. Nutriband
Performance |
| Timeline |
| Bank of America |
| Nutriband |
Bank of America and Nutriband Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Nutriband
The main advantage of trading using opposite Bank of America and Nutriband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Nutriband 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 Nutriband will offset losses from the drop in Nutriband's long position.| Bank of America vs. Amtech Systems | Bank of America vs. Gold Fields Ltd | Bank of America vs. Aegean Airlines SA | Bank of America vs. Merck Company |
| Nutriband vs. Quoin Pharmaceuticals Ltd | Nutriband vs. Longeveron LLC | Nutriband vs. RenovoRx | Nutriband vs. Virax Biolabs 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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