Correlation Between Bank of America and GENERAL
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By analyzing existing cross correlation between Bank of America and GENERAL MLS INC, you can compare the effects of market volatilities on Bank of America and GENERAL 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 GENERAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and GENERAL.
Diversification Opportunities for Bank of America and GENERAL
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and GENERAL is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and GENERAL MLS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENERAL MLS 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 GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENERAL MLS INC has no effect on the direction of Bank of America i.e., Bank of America and GENERAL go up and down completely randomly.
Pair Corralation between Bank of America and GENERAL
Considering the 90-day investment horizon Bank of America is expected to generate 42.6 times less return on investment than GENERAL. But when comparing it to its historical volatility, Bank of America is 43.51 times less risky than GENERAL. It trades about 0.06 of its potential returns per unit of risk. GENERAL MLS INC is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 9,232 in GENERAL MLS INC on September 3, 2024 and sell it today you would earn a total of 236.00 from holding GENERAL MLS INC or generate 2.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 44.04% |
| Values | Daily Returns |
Bank of America vs. GENERAL MLS INC
Performance |
| Timeline |
| Bank of America |
| GENERAL MLS INC |
Bank of America and GENERAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and GENERAL
The main advantage of trading using opposite Bank of America and GENERAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, GENERAL 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 GENERAL will offset losses from the drop in GENERAL's long position.| Bank of America vs. Partner Communications | Bank of America vs. Merck Company | Bank of America vs. Western Midstream Partners | Bank of America vs. Edgewise Therapeutics |
| GENERAL vs. Mesa Air Group | GENERAL vs. LB Foster | GENERAL vs. Hertz Global Holdings | GENERAL vs. Avis Budget Group |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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