Correlation Between TBC Bank and Bank of America
Can any of the company-specific risk be diversified away by investing in both TBC Bank and Bank of America 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 TBC Bank and Bank of America into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TBC Bank Group and Bank of America, you can compare the effects of market volatilities on TBC Bank and Bank of America 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 TBC Bank with a short position of Bank of America. Check out your portfolio center. Please also check ongoing floating volatility patterns of TBC Bank and Bank of America.
Diversification Opportunities for TBC Bank and Bank of America
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between TBC and Bank is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding TBC Bank Group and Bank of America in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of America and TBC Bank 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 TBC Bank Group are associated (or correlated) with Bank of America. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of America has no effect on the direction of TBC Bank i.e., TBC Bank and Bank of America go up and down completely randomly.
Pair Corralation between TBC Bank and Bank of America
Assuming the 90 days trading horizon TBC Bank Group is expected to under-perform the Bank of America. In addition to that, TBC Bank is 1.82 times more volatile than Bank of America. It trades about -0.1 of its total potential returns per unit of risk. Bank of America is currently generating about 0.13 per unit of volatility. If you would invest 4,765 in Bank of America on August 17, 2025 and sell it today you would earn a total of 496.00 from holding Bank of America or generate 10.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TBC Bank Group vs. Bank of America
Performance |
| Timeline |
| TBC Bank Group |
| Bank of America |
TBC Bank and Bank of America Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TBC Bank and Bank of America
The main advantage of trading using opposite TBC Bank and Bank of America positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TBC Bank position performs unexpectedly, Bank of America 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 Bank of America will offset losses from the drop in Bank of America's long position.| TBC Bank vs. Primary Health Properties | TBC Bank vs. Dairy Farm International | TBC Bank vs. HCA Healthcare | TBC Bank vs. Universal Health Services |
| Bank of America vs. Wells Fargo | Bank of America vs. HSBC Holdings PLC | Bank of America vs. Royal Bank of | Bank of America vs. Citigroup |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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