Correlation Between Bank of America and WALMART
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By analyzing existing cross correlation between Bank of America and WALMART INC, you can compare the effects of market volatilities on Bank of America and WALMART 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 WALMART. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and WALMART.
Diversification Opportunities for Bank of America and WALMART
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and WALMART is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and WALMART INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WALMART 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 WALMART. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WALMART INC has no effect on the direction of Bank of America i.e., Bank of America and WALMART go up and down completely randomly.
Pair Corralation between Bank of America and WALMART
Considering the 90-day investment horizon Bank of America is expected to generate 5.61 times more return on investment than WALMART. However, Bank of America is 5.61 times more volatile than WALMART INC. It trades about 0.1 of its potential returns per unit of risk. WALMART INC is currently generating about 0.02 per unit of risk. If you would invest 3,883 in Bank of America on August 24, 2024 and sell it today you would earn a total of 763.00 from holding Bank of America or generate 19.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 87.2% |
| Values | Daily Returns |
Bank of America vs. WALMART INC
Performance |
| Timeline |
| Bank of America |
| WALMART INC |
Bank of America and WALMART Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and WALMART
The main advantage of trading using opposite Bank of America and WALMART positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, WALMART 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 WALMART will offset losses from the drop in WALMART's long position.| Bank of America vs. Wells Fargo | Bank of America vs. Toronto Dominion Bank | Bank of America vs. Royal Bank of | Bank of America vs. JPMorgan Chase Co |
| WALMART vs. Digi International | WALMART vs. Nexstar Broadcasting Group | WALMART vs. Anterix | WALMART vs. Bright Scholar Education |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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