Correlation Between Bank of America and APPLE
Specify exactly 2 symbols:
By analyzing existing cross correlation between Bank of America and APPLE INC 245, you can compare the effects of market volatilities on Bank of America and APPLE 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 APPLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and APPLE.
Diversification Opportunities for Bank of America and APPLE
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and APPLE is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and APPLE INC 245 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APPLE INC 245 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 APPLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APPLE INC 245 has no effect on the direction of Bank of America i.e., Bank of America and APPLE go up and down completely randomly.
Pair Corralation between Bank of America and APPLE
Considering the 90-day investment horizon Bank of America is expected to generate 5.87 times more return on investment than APPLE. However, Bank of America is 5.87 times more volatile than APPLE INC 245. It trades about 0.12 of its potential returns per unit of risk. APPLE INC 245 is currently generating about -0.01 per unit of risk. If you would invest 3,409 in Bank of America on August 27, 2024 and sell it today you would earn a total of 1,291 from holding Bank of America or generate 37.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. APPLE INC 245
Performance |
| Timeline |
| Bank of America |
| APPLE INC 245 |
Bank of America and APPLE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and APPLE
The main advantage of trading using opposite Bank of America and APPLE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, APPLE 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 APPLE will offset losses from the drop in APPLE'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 |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |