Why Is Bank of America Corp (BAC) So Volatile?

But correlation is not causation. While I believe that Bank of America’s reduced stock price contributes to its increased volatility — as it’s cheaper for high-frequency traders to buy and sell large volumes of the deeply liquid security — the bank has also been plagued by fears of further dilution, if not outright failure, multiple times over the last few years. And it’s been this uncertainty that appears to be the primary force behind the volatility.

So what does this mean? If you own shares of Bank of America Corp (NYSE:BAC), as I do, it means that these days of gut-wrenching fluctuations should become less frequent once it’s finished atoning for the sins of the financial crisis — probably by the end of next year or so. Until then, however, there’s every reason to believe that it will continue to test investors’ patience and fortitude.

The article Why Is Bank of America So Volatile? originally appeared on Fool.com.

John Maxfield owns shares of Bank of America. The Motley Fool recommends and owns shares of Bank of America.

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