Correlation Between Bank of America and Helix BioPharma
Can any of the company-specific risk be diversified away by investing in both Bank of America and Helix BioPharma 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 Helix BioPharma 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 Helix BioPharma Corp, you can compare the effects of market volatilities on Bank of America and Helix BioPharma 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 Helix BioPharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Helix BioPharma.
Diversification Opportunities for Bank of America and Helix BioPharma
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bank and Helix is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Helix BioPharma Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helix BioPharma Corp 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 Helix BioPharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helix BioPharma Corp has no effect on the direction of Bank of America i.e., Bank of America and Helix BioPharma go up and down completely randomly.
Pair Corralation between Bank of America and Helix BioPharma
Assuming the 90 days trading horizon Bank of America is expected to generate 2.52 times less return on investment than Helix BioPharma. But when comparing it to its historical volatility, Bank of America is 5.25 times less risky than Helix BioPharma. It trades about 0.29 of its potential returns per unit of risk. Helix BioPharma Corp is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 76.00 in Helix BioPharma Corp on September 4, 2024 and sell it today you would earn a total of 19.00 from holding Helix BioPharma Corp or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of America vs. Helix BioPharma Corp
Performance |
| Timeline |
| Bank of America |
| Helix BioPharma Corp |
Bank of America and Helix BioPharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Helix BioPharma
The main advantage of trading using opposite Bank of America and Helix BioPharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Helix BioPharma 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 Helix BioPharma will offset losses from the drop in Helix BioPharma's long position.| Bank of America vs. Computer Modelling Group | Bank of America vs. Solid Impact Investments | Bank of America vs. Canadian General Investments | Bank of America vs. Partners Value Investments |
| Helix BioPharma vs. Microbix Biosystems | Helix BioPharma vs. Oncolytics Biotech | Helix BioPharma vs. Spectral Med | Helix BioPharma vs. Theratechnologies |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |