Correlation Between Bank of America and Poly Medicure
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By analyzing existing cross correlation between Bank of America and Poly Medicure Limited, you can compare the effects of market volatilities on Bank of America and Poly Medicure 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 Poly Medicure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Poly Medicure.
Diversification Opportunities for Bank of America and Poly Medicure
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Poly is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Poly Medicure Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Poly Medicure Limited 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 Poly Medicure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Poly Medicure Limited has no effect on the direction of Bank of America i.e., Bank of America and Poly Medicure go up and down completely randomly.
Pair Corralation between Bank of America and Poly Medicure
Considering the 90-day investment horizon Bank of America is expected to generate 0.54 times more return on investment than Poly Medicure. However, Bank of America is 1.86 times less risky than Poly Medicure. It trades about 0.27 of its potential returns per unit of risk. Poly Medicure Limited is currently generating about 0.05 per unit of risk. If you would invest 4,189 in Bank of America on August 26, 2024 and sell it today you would earn a total of 511.00 from holding Bank of America or generate 12.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bank of America vs. Poly Medicure Limited
Performance |
| Timeline |
| Bank of America |
| Poly Medicure Limited |
Bank of America and Poly Medicure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Poly Medicure
The main advantage of trading using opposite Bank of America and Poly Medicure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Poly Medicure 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 Poly Medicure will offset losses from the drop in Poly Medicure's long position.| Bank of America vs. Toronto Dominion Bank | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Montreal |
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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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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