Correlation Between Bank of America and 02005NBJ8
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By analyzing existing cross correlation between Bank of America and ALLY FINANCIAL INC, you can compare the effects of market volatilities on Bank of America and 02005NBJ8 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 02005NBJ8. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and 02005NBJ8.
Diversification Opportunities for Bank of America and 02005NBJ8
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and 02005NBJ8 is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and ALLY FINANCIAL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALLY FINANCIAL INC 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 02005NBJ8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALLY FINANCIAL INC has no effect on the direction of Bank of America i.e., Bank of America and 02005NBJ8 go up and down completely randomly.
Pair Corralation between Bank of America and 02005NBJ8
Considering the 90-day investment horizon Bank of America is expected to generate 7.76 times more return on investment than 02005NBJ8. However, Bank of America is 7.76 times more volatile than ALLY FINANCIAL INC. It trades about 0.12 of its potential returns per unit of risk. ALLY FINANCIAL INC is currently generating about -0.22 per unit of risk. If you would invest 4,540 in Bank of America on November 7, 2024 and sell it today you would earn a total of 131.00 from holding Bank of America or generate 2.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Bank of America vs. ALLY FINANCIAL INC
Performance |
| Timeline |
| Bank of America |
| ALLY FINANCIAL INC |
Bank of America and 02005NBJ8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and 02005NBJ8
The main advantage of trading using opposite Bank of America and 02005NBJ8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, 02005NBJ8 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 02005NBJ8 will offset losses from the drop in 02005NBJ8's long position.| Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Royal Bank of | Bank of America vs. Canadian Imperial Bank |
| 02005NBJ8 vs. SEI Investments | 02005NBJ8 vs. Yirendai | 02005NBJ8 vs. Celsius Holdings | 02005NBJ8 vs. Barings BDC |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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