Correlation Between Bank of America and 694308KB2
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By analyzing existing cross correlation between Bank of America and PCG 42 01 MAR 29, you can compare the effects of market volatilities on Bank of America and 694308KB2 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 694308KB2. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and 694308KB2.
Diversification Opportunities for Bank of America and 694308KB2
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and 694308KB2 is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and PCG 42 01 MAR 29 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PCG 42 01 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 694308KB2. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PCG 42 01 has no effect on the direction of Bank of America i.e., Bank of America and 694308KB2 go up and down completely randomly.
Pair Corralation between Bank of America and 694308KB2
Considering the 90-day investment horizon Bank of America is expected to generate 1.35 times more return on investment than 694308KB2. However, Bank of America is 1.35 times more volatile than PCG 42 01 MAR 29. It trades about 0.11 of its potential returns per unit of risk. PCG 42 01 MAR 29 is currently generating about -0.15 per unit of risk. If you would invest 3,965 in Bank of America on September 23, 2024 and sell it today you would earn a total of 452.00 from holding Bank of America or generate 11.4% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 84.62% |
Values | Daily Returns |
Bank of America vs. PCG 42 01 MAR 29
Performance |
Timeline |
Bank of America |
PCG 42 01 |
Bank of America and 694308KB2 Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank of America and 694308KB2
The main advantage of trading using opposite Bank of America and 694308KB2 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, 694308KB2 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 694308KB2 will offset losses from the drop in 694308KB2's long position.Bank of America vs. Nu Holdings | Bank of America vs. Canadian Imperial Bank | Bank of America vs. Bank of Montreal | Bank of America vs. Bank of Nova |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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