Correlation Between Bank of America and 25746UDM8
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By analyzing existing cross correlation between Bank of America and D 435, you can compare the effects of market volatilities on Bank of America and 25746UDM8 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 25746UDM8. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and 25746UDM8.
Diversification Opportunities for Bank of America and 25746UDM8
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and 25746UDM8 is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and D 435 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 25746UDM8 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 25746UDM8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 25746UDM8 has no effect on the direction of Bank of America i.e., Bank of America and 25746UDM8 go up and down completely randomly.
Pair Corralation between Bank of America and 25746UDM8
Considering the 90-day investment horizon Bank of America is expected to generate 1.24 times more return on investment than 25746UDM8. However, Bank of America is 1.24 times more volatile than D 435. It trades about 0.11 of its potential returns per unit of risk. D 435 is currently generating about -0.08 per unit of risk. If you would invest 3,918 in Bank of America on September 2, 2024 and sell it today you would earn a total of 833.00 from holding Bank of America or generate 21.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Bank of America vs. D 435
Performance |
| Timeline |
| Bank of America |
| 25746UDM8 |
Bank of America and 25746UDM8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and 25746UDM8
The main advantage of trading using opposite Bank of America and 25746UDM8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, 25746UDM8 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 25746UDM8 will offset losses from the drop in 25746UDM8's long position.| Bank of America vs. Citigroup | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Bank of Montreal |
| 25746UDM8 vs. Stepstone Group | 25746UDM8 vs. CT Real Estate | 25746UDM8 vs. Fidus Investment Corp | 25746UDM8 vs. Franklin Credit Management |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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