Correlation Between Bank of America and AFLAC
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By analyzing existing cross correlation between Bank of America and AFLAC INC 4, you can compare the effects of market volatilities on Bank of America and AFLAC 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 AFLAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and AFLAC.
Diversification Opportunities for Bank of America and AFLAC
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and AFLAC is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and AFLAC INC 4 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AFLAC INC 4 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 AFLAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AFLAC INC 4 has no effect on the direction of Bank of America i.e., Bank of America and AFLAC go up and down completely randomly.
Pair Corralation between Bank of America and AFLAC
Considering the 90-day investment horizon Bank of America is expected to generate 0.86 times more return on investment than AFLAC. However, Bank of America is 1.17 times less risky than AFLAC. It trades about 0.14 of its potential returns per unit of risk. AFLAC INC 4 is currently generating about 0.05 per unit of risk. If you would invest 2,873 in Bank of America on August 24, 2024 and sell it today you would earn a total of 1,836 from holding Bank of America or generate 63.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 53.6% |
| Values | Daily Returns |
Bank of America vs. AFLAC INC 4
Performance |
| Timeline |
| Bank of America |
| AFLAC INC 4 |
Bank of America and AFLAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and AFLAC
The main advantage of trading using opposite Bank of America and AFLAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, AFLAC 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 AFLAC will offset losses from the drop in AFLAC'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 |
| AFLAC vs. Fortress Transp Infra | AFLAC vs. FTAI Aviation Ltd | AFLAC vs. Vestis | AFLAC vs. Lendlease Global Commercial |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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