Correlation Between Bank of America and Value Grupo
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By analyzing existing cross correlation between Bank of America and Value Grupo Financiero, you can compare the effects of market volatilities on Bank of America and Value Grupo 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 Value Grupo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Value Grupo.
Diversification Opportunities for Bank of America and Value Grupo
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Value is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Value Grupo Financiero in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Value Grupo Financiero 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 Value Grupo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Value Grupo Financiero has no effect on the direction of Bank of America i.e., Bank of America and Value Grupo go up and down completely randomly.
Pair Corralation between Bank of America and Value Grupo
Assuming the 90 days trading horizon Bank of America is expected to generate 1.47 times less return on investment than Value Grupo. But when comparing it to its historical volatility, Bank of America is 1.88 times less risky than Value Grupo. It trades about 0.16 of its potential returns per unit of risk. Value Grupo Financiero is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 8,590 in Value Grupo Financiero on October 12, 2024 and sell it today you would earn a total of 2,110 from holding Value Grupo Financiero or generate 24.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Bank of America vs. Value Grupo Financiero
Performance |
Timeline |
Bank of America |
Value Grupo Financiero |
Bank of America and Value Grupo Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank of America and Value Grupo
The main advantage of trading using opposite Bank of America and Value Grupo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Value Grupo 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 Value Grupo will offset losses from the drop in Value Grupo's long position.Bank of America vs. Grupo Industrial Saltillo | Bank of America vs. Monster Beverage Corp | Bank of America vs. Grupo Carso SAB | Bank of America vs. McEwen Mining |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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