Correlation Between Bank of America and Heliostar Metals
Can any of the company-specific risk be diversified away by investing in both Bank of America and Heliostar Metals 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 Heliostar Metals 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 Heliostar Metals, you can compare the effects of market volatilities on Bank of America and Heliostar Metals 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 Heliostar Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of America and Heliostar Metals.
Diversification Opportunities for Bank of America and Heliostar Metals
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Heliostar is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Bank of America and Heliostar Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heliostar Metals 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 Heliostar Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heliostar Metals has no effect on the direction of Bank of America i.e., Bank of America and Heliostar Metals go up and down completely randomly.
Pair Corralation between Bank of America and Heliostar Metals
Considering the 90-day investment horizon Bank of America is expected to generate 3.54 times less return on investment than Heliostar Metals. But when comparing it to its historical volatility, Bank of America is 3.32 times less risky than Heliostar Metals. It trades about 0.18 of its potential returns per unit of risk. Heliostar Metals is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 93.00 in Heliostar Metals on August 15, 2025 and sell it today you would earn a total of 51.00 from holding Heliostar Metals or generate 54.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Bank of America vs. Heliostar Metals
Performance |
| Timeline |
| Bank of America |
| Heliostar Metals |
Bank of America and Heliostar Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of America and Heliostar Metals
The main advantage of trading using opposite Bank of America and Heliostar Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of America position performs unexpectedly, Heliostar Metals 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 Heliostar Metals will offset losses from the drop in Heliostar Metals' long position.| Bank of America vs. Thrivent High Yield | Bank of America vs. Morningstar Unconstrained Allocation | Bank of America vs. Via Renewables | Bank of America vs. Sitka Gold Corp |
| Heliostar Metals vs. Steppe Gold | Heliostar Metals vs. Gambier Gold Corp | Heliostar Metals vs. Jaguar Mining | Heliostar Metals vs. Thesis Gold |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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