Correlation Between JetBlue Airways and Bank of America
Can any of the company-specific risk be diversified away by investing in both JetBlue Airways 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 JetBlue Airways 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 JetBlue Airways Corp and Bank of America, you can compare the effects of market volatilities on JetBlue Airways 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 JetBlue Airways with a short position of Bank of America. Check out your portfolio center. Please also check ongoing floating volatility patterns of JetBlue Airways and Bank of America.
Diversification Opportunities for JetBlue Airways and Bank of America
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between JetBlue and Bank is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding JetBlue Airways Corp and Bank of America in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of America and JetBlue Airways 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 JetBlue Airways Corp 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 Bank of America has no effect on the direction of JetBlue Airways i.e., JetBlue Airways and Bank of America go up and down completely randomly.
Pair Corralation between JetBlue Airways and Bank of America
Given the investment horizon of 90 days JetBlue Airways Corp is expected to generate 5.45 times more return on investment than Bank of America. However, JetBlue Airways is 5.45 times more volatile than Bank of America. It trades about 0.07 of its potential returns per unit of risk. Bank of America is currently generating about 0.11 per unit of risk. If you would invest 570.00 in JetBlue Airways Corp on September 1, 2024 and sell it today you would earn a total of 27.00 from holding JetBlue Airways Corp or generate 4.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JetBlue Airways Corp vs. Bank of America
Performance |
| Timeline |
| JetBlue Airways Corp |
| Bank of America |
JetBlue Airways and Bank of America Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JetBlue Airways and Bank of America
The main advantage of trading using opposite JetBlue Airways and Bank of America positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JetBlue Airways 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.| JetBlue Airways vs. Canadian Pacific Railway | JetBlue Airways vs. Werner Enterprises | JetBlue Airways vs. Canadian National Railway | JetBlue Airways vs. CSX Corporation |
| Bank of America vs. Bank of America | Bank of America vs. Bank of America | Bank of America vs. China Construction Bank | Bank of America vs. Bank of America |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |