Correlation Between Bank of America and 98385XAM8
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By analyzing existing cross correlation between Bank of America and XTO ENERGY INC, you can compare the effects of market volatilities on Bank of America and 98385XAM8 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 98385XAM8. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and 98385XAM8.
Diversification Opportunities for Bank of America and 98385XAM8
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bank and 98385XAM8 is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and XTO ENERGY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XTO ENERGY 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 98385XAM8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XTO ENERGY INC has no effect on the direction of Bank of America i.e., Bank of America and 98385XAM8 go up and down completely randomly.
Pair Corralation between Bank of America and 98385XAM8
Considering the 90-day investment horizon Bank of America is expected to generate 3.0 times more return on investment than 98385XAM8. However, Bank of America is 3.0 times more volatile than XTO ENERGY INC. It trades about 0.29 of its potential returns per unit of risk. XTO ENERGY INC is currently generating about 0.22 per unit of risk. If you would invest 4,231 in Bank of America on August 31, 2024 and sell it today you would earn a total of 546.00 from holding Bank of America or generate 12.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 59.09% |
| Values | Daily Returns |
Bank of America vs. XTO ENERGY INC
Performance |
| Timeline |
| Bank of America |
| XTO ENERGY INC |
Bank of America and 98385XAM8 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and 98385XAM8
The main advantage of trading using opposite Bank of America and 98385XAM8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, 98385XAM8 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 98385XAM8 will offset losses from the drop in 98385XAM8's long position.| Bank of America vs. RLJ Lodging Trust | Bank of America vs. Aquagold International | Bank of America vs. Stepstone Group | Bank of America vs. Morningstar Unconstrained Allocation |
| 98385XAM8 vs. AEP TEX INC | 98385XAM8 vs. US BANK NATIONAL | 98385XAM8 vs. Bank of America | 98385XAM8 vs. GE Aerospace |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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