Correlation Between Bank of America and Renewable Energy
Can any of the company-specific risk be diversified away by investing in both Bank of America and Renewable Energy 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 Renewable Energy 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 Renewable Energy and, you can compare the effects of market volatilities on Bank of America and Renewable Energy 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 Renewable Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Renewable Energy.
Diversification Opportunities for Bank of America and Renewable Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Renewable is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Renewable Energy and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Renewable Energy 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 Renewable Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Renewable Energy has no effect on the direction of Bank of America i.e., Bank of America and Renewable Energy go up and down completely randomly.
Pair Corralation between Bank of America and Renewable Energy
If you would invest 3,883 in Bank of America on August 25, 2024 and sell it today you would earn a total of 817.00 from holding Bank of America or generate 21.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. Renewable Energy and
Performance |
| Timeline |
| Bank of America |
| Renewable Energy |
Bank of America and Renewable Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Renewable Energy
The main advantage of trading using opposite Bank of America and Renewable Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Renewable Energy 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 Renewable Energy will offset losses from the drop in Renewable Energy'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 |
| Renewable Energy vs. Asics Corp ADR | Renewable Energy vs. American Rebel Holdings | Renewable Energy vs. American Rebel Holdings | Renewable Energy vs. Crocs Inc |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |