Correlation Between Bank of America and ALLSTATE
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By analyzing existing cross correlation between Bank of America and ALLSTATE P 535, you can compare the effects of market volatilities on Bank of America and ALLSTATE 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 ALLSTATE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and ALLSTATE.
Diversification Opportunities for Bank of America and ALLSTATE
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and ALLSTATE is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and ALLSTATE P 535 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALLSTATE P 535 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 ALLSTATE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALLSTATE P 535 has no effect on the direction of Bank of America i.e., Bank of America and ALLSTATE go up and down completely randomly.
Pair Corralation between Bank of America and ALLSTATE
Considering the 90-day investment horizon Bank of America is expected to generate 1.98 times more return on investment than ALLSTATE. However, Bank of America is 1.98 times more volatile than ALLSTATE P 535. It trades about 0.17 of its potential returns per unit of risk. ALLSTATE P 535 is currently generating about -0.01 per unit of risk. If you would invest 4,044 in Bank of America on August 31, 2024 and sell it today you would earn a total of 733.00 from holding Bank of America or generate 18.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 88.89% |
| Values | Daily Returns |
Bank of America vs. ALLSTATE P 535
Performance |
| Timeline |
| Bank of America |
| ALLSTATE P 535 |
Bank of America and ALLSTATE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and ALLSTATE
The main advantage of trading using opposite Bank of America and ALLSTATE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, ALLSTATE 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 ALLSTATE will offset losses from the drop in ALLSTATE'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 |
| ALLSTATE vs. Live Ventures | ALLSTATE vs. Monster Beverage Corp | ALLSTATE vs. Haverty Furniture Companies | ALLSTATE vs. China Tontine Wines |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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