Correlation Between Bank of America and CONSTELLATION
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By analyzing existing cross correlation between Bank of America and CONSTELLATION BRANDS INC, you can compare the effects of market volatilities on Bank of America and CONSTELLATION 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 CONSTELLATION. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and CONSTELLATION.
Diversification Opportunities for Bank of America and CONSTELLATION
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and CONSTELLATION is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and CONSTELLATION BRANDS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONSTELLATION BRANDS 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 CONSTELLATION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CONSTELLATION BRANDS INC has no effect on the direction of Bank of America i.e., Bank of America and CONSTELLATION go up and down completely randomly.
Pair Corralation between Bank of America and CONSTELLATION
Considering the 90-day investment horizon Bank of America is expected to generate 14.75 times more return on investment than CONSTELLATION. However, Bank of America is 14.75 times more volatile than CONSTELLATION BRANDS INC. It trades about 0.26 of its potential returns per unit of risk. CONSTELLATION BRANDS INC is currently generating about -0.02 per unit of risk. If you would invest 4,262 in Bank of America on August 28, 2024 and sell it today you would earn a total of 488.00 from holding Bank of America or generate 11.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. CONSTELLATION BRANDS INC
Performance |
| Timeline |
| Bank of America |
| CONSTELLATION BRANDS INC |
Bank of America and CONSTELLATION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and CONSTELLATION
The main advantage of trading using opposite Bank of America and CONSTELLATION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, CONSTELLATION 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 CONSTELLATION will offset losses from the drop in CONSTELLATION'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 |
| CONSTELLATION vs. The Coca Cola | CONSTELLATION vs. JPMorgan Chase Co | CONSTELLATION vs. Dupont De Nemours | CONSTELLATION vs. Alcoa Corp |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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