Correlation Between Bank of America and Super Energy
Can any of the company-specific risk be diversified away by investing in both Bank of America and Super 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 Super 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 Super Energy Tbk, you can compare the effects of market volatilities on Bank of America and Super 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 Super Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Super Energy.
Diversification Opportunities for Bank of America and Super Energy
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Super is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Super Energy Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Super Energy Tbk 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 Super Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Super Energy Tbk has no effect on the direction of Bank of America i.e., Bank of America and Super Energy go up and down completely randomly.
Pair Corralation between Bank of America and Super Energy
Considering the 90-day investment horizon Bank of America is expected to generate 1.17 times less return on investment than Super Energy. But when comparing it to its historical volatility, Bank of America is 1.54 times less risky than Super Energy. It trades about 0.06 of its potential returns per unit of risk. Super Energy Tbk is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 153,500 in Super Energy Tbk on September 2, 2024 and sell it today you would earn a total of 77,500 from holding Super Energy Tbk or generate 50.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.77% |
| Values | Daily Returns |
Bank of America vs. Super Energy Tbk
Performance |
| Timeline |
| Bank of America |
| Super Energy Tbk |
Bank of America and Super Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Super Energy
The main advantage of trading using opposite Bank of America and Super Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Super 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 Super Energy will offset losses from the drop in Super Energy's long position.| Bank of America vs. Citigroup | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Montreal |
| Super Energy vs. Mitrabahtera Segara Sejati | Super Energy vs. Weha Transportasi Indonesia | Super Energy vs. Rig Tenders Tbk |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |