Correlation Between Bank of America and 20825CAF1
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By analyzing existing cross correlation between Bank of America and CONOCOPHILLIPS 59 percent, you can compare the effects of market volatilities on Bank of America and 20825CAF1 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 20825CAF1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and 20825CAF1.
Diversification Opportunities for Bank of America and 20825CAF1
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and 20825CAF1 is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and CONOCOPHILLIPS 59 percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONOCOPHILLIPS 59 percent 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 20825CAF1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CONOCOPHILLIPS 59 percent has no effect on the direction of Bank of America i.e., Bank of America and 20825CAF1 go up and down completely randomly.
Pair Corralation between Bank of America and 20825CAF1
Considering the 90-day investment horizon Bank of America is expected to generate 2.65 times more return on investment than 20825CAF1. However, Bank of America is 2.65 times more volatile than CONOCOPHILLIPS 59 percent. It trades about 0.12 of its potential returns per unit of risk. CONOCOPHILLIPS 59 percent is currently generating about 0.0 per unit of risk. If you would invest 3,815 in Bank of America on August 28, 2024 and sell it today you would earn a total of 935.00 from holding Bank of America or generate 24.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. CONOCOPHILLIPS 59 percent
Performance |
| Timeline |
| Bank of America |
| CONOCOPHILLIPS 59 percent |
Bank of America and 20825CAF1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and 20825CAF1
The main advantage of trading using opposite Bank of America and 20825CAF1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, 20825CAF1 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 20825CAF1 will offset losses from the drop in 20825CAF1's long position.| Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Montreal | Bank of America vs. Bank of Nova |
| 20825CAF1 vs. Village Super Market | 20825CAF1 vs. VirnetX Holding Corp | 20825CAF1 vs. NH Foods Ltd | 20825CAF1 vs. Bridgford Foods |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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