Correlation Between Bank of America and 48250NAC9
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By analyzing existing cross correlation between Bank of America and KFC Holding 475, you can compare the effects of market volatilities on Bank of America and 48250NAC9 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 48250NAC9. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and 48250NAC9.
Diversification Opportunities for Bank of America and 48250NAC9
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and 48250NAC9 is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and KFC Holding 475 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KFC Holding 475 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 48250NAC9. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KFC Holding 475 has no effect on the direction of Bank of America i.e., Bank of America and 48250NAC9 go up and down completely randomly.
Pair Corralation between Bank of America and 48250NAC9
Considering the 90-day investment horizon Bank of America is expected to generate 43.91 times less return on investment than 48250NAC9. But when comparing it to its historical volatility, Bank of America is 44.24 times less risky than 48250NAC9. It trades about 0.06 of its potential returns per unit of risk. KFC Holding 475 is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 9,734 in KFC Holding 475 on August 28, 2024 and sell it today you would lose (172.00) from holding KFC Holding 475 or give up 1.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 84.85% |
| Values | Daily Returns |
Bank of America vs. KFC Holding 475
Performance |
| Timeline |
| Bank of America |
| KFC Holding 475 |
Bank of America and 48250NAC9 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and 48250NAC9
The main advantage of trading using opposite Bank of America and 48250NAC9 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, 48250NAC9 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 48250NAC9 will offset losses from the drop in 48250NAC9'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 |
| 48250NAC9 vs. The Coca Cola | 48250NAC9 vs. JPMorgan Chase Co | 48250NAC9 vs. Dupont De Nemours | 48250NAC9 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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