Correlation Between B of A and Aeroclean Technologies

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both B of A and Aeroclean Technologies 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 B of A and Aeroclean Technologies 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 Aeroclean Technologies, you can compare the effects of market volatilities on B of A and Aeroclean Technologies 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 B of A with a short position of Aeroclean Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of B of A and Aeroclean Technologies.

Diversification Opportunities for B of A and Aeroclean Technologies

-0.69
  Correlation Coefficient

Excellent diversification

The 3 months correlation between B of A and Aeroclean is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Bank Of America and Aeroclean Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeroclean Technologies and B of A 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 Aeroclean Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeroclean Technologies has no effect on the direction of B of A i.e., B of A and Aeroclean Technologies go up and down completely randomly.

Pair Corralation between B of A and Aeroclean Technologies

Considering the 90-day investment horizon Bank Of America is expected to generate 0.11 times more return on investment than Aeroclean Technologies. However, Bank Of America is 9.02 times less risky than Aeroclean Technologies. It trades about -0.08 of its potential returns per unit of risk. Aeroclean Technologies is currently generating about -0.02 per unit of risk. If you would invest  4,674  in Bank Of America on June 26, 2022 and sell it today you would lose (1,501)  from holding Bank Of America or give up 32.11% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy92.11%
ValuesDaily Returns

Bank Of America  vs.  Aeroclean Technologies

 Performance (%) 
       Timeline  
Bank Of America 
B of A Performance
0 of 100
Over the last 90 days Bank Of America has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, B of A is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

B of A Price Channel

Aeroclean Technologies 
Aeroclean Performance
0 of 100
Over the last 90 days Aeroclean Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in October 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Aeroclean Price Channel

B of A and Aeroclean Technologies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with B of A and Aeroclean Technologies

The main advantage of trading using opposite B of A and Aeroclean Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if B of A position performs unexpectedly, Aeroclean Technologies 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 Aeroclean Technologies will offset losses from the drop in Aeroclean Technologies' long position.
B of A vs. China Construction B
The idea behind Bank Of America and Aeroclean Technologies 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.
Aeroclean Technologies vs. BUSHVELD MINERALS LTD
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..

Other Complementary Tools

ETF Directory
Find actively traded Exchange Traded Funds (ETF) from around the world
Go
Equity Valuation
Check real value of public entities based on technical and fundamental data
Go
Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Go
Cryptocurrency Center
Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency
Go
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.
Go
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Go
Money Managers
Screen money managers from public funds and ETFs managed around the world
Go
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Go
Pair Correlation
Compare performance and examine fundamental relationship between any two equity instruments
Go
Focused Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Go
Shere Portfolio
Track or share privately all of your investments from the convenience of any device
Go
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Go