Correlation Between Bank of America and SPECTRA
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By analyzing existing cross correlation between Bank of America and SPECTRA ENERGY PARTNERS, you can compare the effects of market volatilities on Bank of America and SPECTRA 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 SPECTRA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and SPECTRA.
Diversification Opportunities for Bank of America and SPECTRA
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and SPECTRA is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and SPECTRA ENERGY PARTNERS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPECTRA ENERGY PARTNERS 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 SPECTRA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPECTRA ENERGY PARTNERS has no effect on the direction of Bank of America i.e., Bank of America and SPECTRA go up and down completely randomly.
Pair Corralation between Bank of America and SPECTRA
Considering the 90-day investment horizon Bank of America is expected to generate 7.13 times more return on investment than SPECTRA. However, Bank of America is 7.13 times more volatile than SPECTRA ENERGY PARTNERS. It trades about 0.31 of its potential returns per unit of risk. SPECTRA ENERGY PARTNERS is currently generating about -0.23 per unit of risk. If you would invest 4,182 in Bank of America on September 1, 2024 and sell it today you would earn a total of 569.00 from holding Bank of America or generate 13.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Bank of America vs. SPECTRA ENERGY PARTNERS
Performance |
| Timeline |
| Bank of America |
| SPECTRA ENERGY PARTNERS |
Bank of America and SPECTRA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and SPECTRA
The main advantage of trading using opposite Bank of America and SPECTRA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, SPECTRA 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 SPECTRA will offset losses from the drop in SPECTRA's long position.| Bank of America vs. Citigroup | Bank of America vs. Royal Bank of | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC |
| SPECTRA vs. Emerson Electric | SPECTRA vs. Mesa Air Group | SPECTRA vs. Allegiant Travel | SPECTRA vs. Air Transport Services |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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