Correlation Between Bank of America and PT Wintermar
Can any of the company-specific risk be diversified away by investing in both Bank of America and PT Wintermar at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Bank of America and PT Wintermar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bank of America and PT Wintermar Offshore, you can compare the effects of market volatilities on Bank of America and PT Wintermar 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 PT Wintermar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and PT Wintermar.
Diversification Opportunities for Bank of America and PT Wintermar
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and W6O is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and PT Wintermar Offshore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Wintermar Offshore 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 PT Wintermar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Wintermar Offshore has no effect on the direction of Bank of America i.e., Bank of America and PT Wintermar go up and down completely randomly.
Pair Corralation between Bank of America and PT Wintermar
Considering the 90-day investment horizon Bank of America is expected to generate 0.26 times more return on investment than PT Wintermar. However, Bank of America is 3.9 times less risky than PT Wintermar. It trades about 0.21 of its potential returns per unit of risk. PT Wintermar Offshore is currently generating about -0.11 per unit of risk. If you would invest 4,434 in Bank of America on October 28, 2024 and sell it today you would earn a total of 218.00 from holding Bank of America or generate 4.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Bank of America vs. PT Wintermar Offshore
Performance |
| Timeline |
| Bank of America |
| PT Wintermar Offshore |
Bank of America and PT Wintermar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and PT Wintermar
The main advantage of trading using opposite Bank of America and PT Wintermar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, PT Wintermar 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 PT Wintermar will offset losses from the drop in PT Wintermar's long position.| Bank of America vs. Toronto Dominion Bank | Bank of America vs. Royal Bank of | Bank of America vs. Nu Holdings | Bank of America vs. HSBC Holdings PLC |
| PT Wintermar vs. AP Mller | PT Wintermar vs. AP Mller | PT Wintermar vs. HAPAG LLOYD UNSPADR 12 | PT Wintermar vs. DFDS AS |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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