Correlation Between Bankwell Financial and Byline Bancorp
Can any of the company-specific risk be diversified away by investing in both Bankwell Financial and Byline Bancorp 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 Bankwell Financial and Byline Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bankwell Financial Group and Byline Bancorp, you can compare the effects of market volatilities on Bankwell Financial and Byline Bancorp 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 Bankwell Financial with a short position of Byline Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankwell Financial and Byline Bancorp.
Diversification Opportunities for Bankwell Financial and Byline Bancorp
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bankwell and Byline is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Bankwell Financial Group and Byline Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Byline Bancorp and Bankwell Financial 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 Bankwell Financial Group are associated (or correlated) with Byline Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Byline Bancorp has no effect on the direction of Bankwell Financial i.e., Bankwell Financial and Byline Bancorp go up and down completely randomly.
Pair Corralation between Bankwell Financial and Byline Bancorp
Given the investment horizon of 90 days Bankwell Financial is expected to generate 1.16 times less return on investment than Byline Bancorp. In addition to that, Bankwell Financial is 1.5 times more volatile than Byline Bancorp. It trades about 0.08 of its total potential returns per unit of risk. Byline Bancorp is currently generating about 0.15 per unit of volatility. If you would invest 2,842 in Byline Bancorp on November 2, 2024 and sell it today you would earn a total of 113.00 from holding Byline Bancorp or generate 3.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bankwell Financial Group vs. Byline Bancorp
Performance |
| Timeline |
| Bankwell Financial |
| Byline Bancorp |
Bankwell Financial and Byline Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankwell Financial and Byline Bancorp
The main advantage of trading using opposite Bankwell Financial and Byline Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankwell Financial position performs unexpectedly, Byline Bancorp 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 Byline Bancorp will offset losses from the drop in Byline Bancorp's long position.| Bankwell Financial vs. Franklin Financial Services | Bankwell Financial vs. The First Bancshares, | Bankwell Financial vs. Home Federal Bancorp | Bankwell Financial vs. Lake Shore Bancorp |
| Byline Bancorp vs. Affinity Bancshares | Byline Bancorp vs. Home Federal Bancorp | Byline Bancorp vs. LINKBANCORP | Byline Bancorp vs. Bankwell Financial Group |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |