Correlation Between Bank of America and SPDR Nuveen
Can any of the company-specific risk be diversified away by investing in both Bank of America and SPDR Nuveen 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 SPDR Nuveen 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 SPDR Nuveen Bloomberg, you can compare the effects of market volatilities on Bank of America and SPDR Nuveen 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 SPDR Nuveen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and SPDR Nuveen.
Diversification Opportunities for Bank of America and SPDR Nuveen
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and SPDR is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and SPDR Nuveen Bloomberg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR Nuveen Bloomberg 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 SPDR Nuveen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR Nuveen Bloomberg has no effect on the direction of Bank of America i.e., Bank of America and SPDR Nuveen go up and down completely randomly.
Pair Corralation between Bank of America and SPDR Nuveen
Considering the 90-day investment horizon Bank of America is expected to generate 12.54 times more return on investment than SPDR Nuveen. However, Bank of America is 12.54 times more volatile than SPDR Nuveen Bloomberg. It trades about 0.29 of its potential returns per unit of risk. SPDR Nuveen Bloomberg is currently generating about 0.11 per unit of risk. If you would invest 4,231 in Bank of America on August 31, 2024 and sell it today you would earn a total of 546.00 from holding Bank of America or generate 12.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. SPDR Nuveen Bloomberg
Performance |
| Timeline |
| Bank of America |
| SPDR Nuveen Bloomberg |
Bank of America and SPDR Nuveen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and SPDR Nuveen
The main advantage of trading using opposite Bank of America and SPDR Nuveen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, SPDR Nuveen 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 SPDR Nuveen will offset losses from the drop in SPDR Nuveen'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 |
| SPDR Nuveen vs. SPDR Nuveen Bloomberg | SPDR Nuveen vs. VanEck Intermediate Muni | SPDR Nuveen vs. Invesco National AMT Free | SPDR Nuveen vs. VanEck Short Muni |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |