Correlation Between Bank of America and Silgo Retail
Can any of the company-specific risk be diversified away by investing in both Bank of America and Silgo Retail 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 Silgo Retail 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 Silgo Retail Limited, you can compare the effects of market volatilities on Bank of America and Silgo Retail 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 Silgo Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Silgo Retail.
Diversification Opportunities for Bank of America and Silgo Retail
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Silgo is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Silgo Retail Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silgo Retail 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 Silgo Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silgo Retail Limited has no effect on the direction of Bank of America i.e., Bank of America and Silgo Retail go up and down completely randomly.
Pair Corralation between Bank of America and Silgo Retail
Considering the 90-day investment horizon Bank of America is expected to generate 2.71 times less return on investment than Silgo Retail. But when comparing it to its historical volatility, Bank of America is 2.67 times less risky than Silgo Retail. It trades about 0.05 of its potential returns per unit of risk. Silgo Retail Limited is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,955 in Silgo Retail Limited on November 27, 2024 and sell it today you would earn a total of 2,031 from holding Silgo Retail Limited or generate 103.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.17% |
| Values | Daily Returns |
Bank of America vs. Silgo Retail Limited
Performance |
| Timeline |
| Bank of America |
| Silgo Retail Limited |
Bank of America and Silgo Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Silgo Retail
The main advantage of trading using opposite Bank of America and Silgo Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Silgo Retail 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 Silgo Retail will offset losses from the drop in Silgo Retail's long position.| Bank of America vs. Citigroup | Bank of America vs. Wells Fargo | Bank of America vs. Toronto Dominion Bank | Bank of America vs. Royal Bank of |
| Silgo Retail vs. Spandana Sphoorty Financial | Silgo Retail vs. 21st Century Management | Silgo Retail vs. Karur Vysya Bank | Silgo Retail vs. Computer Age Management |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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