Correlation Between Bank of America and 37940XAP7
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By analyzing existing cross correlation between Bank of America and GPN 495 15 AUG 27, you can compare the effects of market volatilities on Bank of America and 37940XAP7 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 37940XAP7. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and 37940XAP7.
Diversification Opportunities for Bank of America and 37940XAP7
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bank and 37940XAP7 is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and GPN 495 15 AUG 27 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GPN 495 15 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 37940XAP7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GPN 495 15 has no effect on the direction of Bank of America i.e., Bank of America and 37940XAP7 go up and down completely randomly.
Pair Corralation between Bank of America and 37940XAP7
Considering the 90-day investment horizon Bank of America is expected to generate 10.04 times more return on investment than 37940XAP7. However, Bank of America is 10.04 times more volatile than GPN 495 15 AUG 27. It trades about 0.05 of its potential returns per unit of risk. GPN 495 15 AUG 27 is currently generating about 0.07 per unit of risk. If you would invest 3,916 in Bank of America on November 28, 2024 and sell it today you would earn a total of 478.00 from holding Bank of America or generate 12.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.91% |
| Values | Daily Returns |
Bank of America vs. GPN 495 15 AUG 27
Performance |
| Timeline |
| Bank of America |
| GPN 495 15 |
Bank of America and 37940XAP7 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and 37940XAP7
The main advantage of trading using opposite Bank of America and 37940XAP7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, 37940XAP7 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 37940XAP7 will offset losses from the drop in 37940XAP7's long position.| Bank of America vs. Citigroup | Bank of America vs. Wells Fargo | Bank of America vs. Toronto Dominion Bank | Bank of America vs. Royal Bank of |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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