Correlation Between Jacquet Metal and Bank of America
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Bank of America 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 Jacquet Metal and Bank of America into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and Verizon Communications, you can compare the effects of market volatilities on Jacquet Metal and Bank of America 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 Jacquet Metal with a short position of Bank of America. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Bank of America.
Diversification Opportunities for Jacquet Metal and Bank of America
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jacquet and Bank is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Verizon Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Verizon Communications and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with Bank of America. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Verizon Communications has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Bank of America go up and down completely randomly.
Pair Corralation between Jacquet Metal and Bank of America
Assuming the 90 days horizon Jacquet Metal Service is expected to under-perform the Bank of America. In addition to that, Jacquet Metal is 1.17 times more volatile than Verizon Communications. It trades about -0.1 of its total potential returns per unit of risk. Verizon Communications is currently generating about 0.33 per unit of volatility. If you would invest 3,858 in Verizon Communications on September 1, 2024 and sell it today you would earn a total of 342.00 from holding Verizon Communications or generate 8.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Jacquet Metal Service vs. Verizon Communications
Performance |
| Timeline |
| Jacquet Metal Service |
| Verizon Communications |
Jacquet Metal and Bank of America Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and Bank of America
The main advantage of trading using opposite Jacquet Metal and Bank of America positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Bank of America 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 Bank of America will offset losses from the drop in Bank of America's long position.| Jacquet Metal vs. BORR DRILLING NEW | Jacquet Metal vs. Carsales | Jacquet Metal vs. Gruppo Mutuionline SpA | Jacquet Metal vs. GungHo Online Entertainment |
| Bank of America vs. Direct Line Insurance | Bank of America vs. Harmony Gold Mining | Bank of America vs. The Hanover Insurance | Bank of America vs. Jacquet Metal Service |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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