Correlation Between Byline Bancorp and Banc Of
Can any of the company-specific risk be diversified away by investing in both Byline Bancorp and Banc Of 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 Byline Bancorp and Banc Of into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Byline Bancorp and Banc of California, you can compare the effects of market volatilities on Byline Bancorp and Banc Of 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 Byline Bancorp with a short position of Banc Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of Byline Bancorp and Banc Of.
Diversification Opportunities for Byline Bancorp and Banc Of
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Byline and Banc is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Byline Bancorp and Banc of California in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banc of California and Byline Bancorp 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 Byline Bancorp are associated (or correlated) with Banc Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banc of California has no effect on the direction of Byline Bancorp i.e., Byline Bancorp and Banc Of go up and down completely randomly.
Pair Corralation between Byline Bancorp and Banc Of
Allowing for the 90-day total investment horizon Byline Bancorp is expected to generate 7.69 times more return on investment than Banc Of. However, Byline Bancorp is 7.69 times more volatile than Banc of California. It trades about 0.17 of its potential returns per unit of risk. Banc of California is currently generating about 0.35 per unit of risk. If you would invest 2,775 in Byline Bancorp on August 29, 2024 and sell it today you would earn a total of 403.00 from holding Byline Bancorp or generate 14.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Byline Bancorp vs. Banc of California
Performance |
| Timeline |
| Byline Bancorp |
| Banc of California |
Byline Bancorp and Banc Of Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Byline Bancorp and Banc Of
The main advantage of trading using opposite Byline Bancorp and Banc Of positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Byline Bancorp position performs unexpectedly, Banc Of 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 Banc Of will offset losses from the drop in Banc Of's long position.| Byline Bancorp vs. Affinity Bancshares | Byline Bancorp vs. Home Federal Bancorp | Byline Bancorp vs. LINKBANCORP | Byline Bancorp vs. Bankwell Financial Group |
| Banc Of vs. Axos Financial | Banc Of vs. Byline Bancorp | Banc Of vs. KB Financial Group | Banc Of vs. Nu Holdings |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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