Correlation Between Bank of America and Standard Uranium
Can any of the company-specific risk be diversified away by investing in both Bank of America and Standard Uranium 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 Standard Uranium 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 Standard Uranium, you can compare the effects of market volatilities on Bank of America and Standard Uranium 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 Standard Uranium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Standard Uranium.
Diversification Opportunities for Bank of America and Standard Uranium
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Standard is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Standard Uranium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Standard Uranium 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 Standard Uranium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Standard Uranium has no effect on the direction of Bank of America i.e., Bank of America and Standard Uranium go up and down completely randomly.
Pair Corralation between Bank of America and Standard Uranium
Considering the 90-day investment horizon Bank of America is expected to generate 0.21 times more return on investment than Standard Uranium. However, Bank of America is 4.78 times less risky than Standard Uranium. It trades about 0.16 of its potential returns per unit of risk. Standard Uranium is currently generating about -0.01 per unit of risk. If you would invest 2,499 in Bank of America on August 25, 2024 and sell it today you would earn a total of 2,201 from holding Bank of America or generate 88.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.63% |
| Values | Daily Returns |
Bank of America vs. Standard Uranium
Performance |
| Timeline |
| Bank of America |
| Standard Uranium |
Bank of America and Standard Uranium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Standard Uranium
The main advantage of trading using opposite Bank of America and Standard Uranium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Standard Uranium 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 Standard Uranium will offset losses from the drop in Standard Uranium'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 |
| Standard Uranium vs. Appia Energy Corp | Standard Uranium vs. Anfield Resources | Standard Uranium vs. Purepoint Uranium Group | Standard Uranium vs. Bannerman Resources |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |