Correlation Between Bank of America and Calvert Mid
Can any of the company-specific risk be diversified away by investing in both Bank of America and Calvert Mid 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 Calvert Mid 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 Calvert Mid Cap, you can compare the effects of market volatilities on Bank of America and Calvert Mid 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 Calvert Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Calvert Mid.
Diversification Opportunities for Bank of America and Calvert Mid
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Calvert is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Calvert Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calvert Mid Cap 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 Calvert Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calvert Mid Cap has no effect on the direction of Bank of America i.e., Bank of America and Calvert Mid go up and down completely randomly.
Pair Corralation between Bank of America and Calvert Mid
Considering the 90-day investment horizon Bank of America is expected to generate 1.36 times more return on investment than Calvert Mid. However, Bank of America is 1.36 times more volatile than Calvert Mid Cap. It trades about 0.23 of its potential returns per unit of risk. Calvert Mid Cap is currently generating about 0.19 per unit of risk. If you would invest 4,083 in Bank of America on May 2, 2025 and sell it today you would earn a total of 713.00 from holding Bank of America or generate 17.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Bank of America vs. Calvert Mid Cap
Performance |
Timeline |
Bank of America |
Calvert Mid Cap |
Bank of America and Calvert Mid Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank of America and Calvert Mid
The main advantage of trading using opposite Bank of America and Calvert Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Calvert Mid 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 Calvert Mid will offset losses from the drop in Calvert Mid's long position.The idea behind Bank of America and Calvert Mid Cap pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.Calvert Mid vs. Calvert Large Cap | Calvert Mid vs. Calvert Small Cap | Calvert Mid vs. Blackrock Smallmid Cap | Calvert Mid vs. Calvert Large Cap |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Transaction History View history of all your transactions and understand their impact on performance |