Correlation Between Byline Bancorp and BancFirst
Can any of the company-specific risk be diversified away by investing in both Byline Bancorp and BancFirst 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 BancFirst into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Byline Bancorp and BancFirst, you can compare the effects of market volatilities on Byline Bancorp and BancFirst 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 BancFirst. Check out your portfolio center. Please also check ongoing floating volatility patterns of Byline Bancorp and BancFirst.
Diversification Opportunities for Byline Bancorp and BancFirst
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Byline and BancFirst is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Byline Bancorp and BancFirst in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BancFirst 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 BancFirst. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BancFirst has no effect on the direction of Byline Bancorp i.e., Byline Bancorp and BancFirst go up and down completely randomly.
Pair Corralation between Byline Bancorp and BancFirst
Allowing for the 90-day total investment horizon Byline Bancorp is expected to under-perform the BancFirst. In addition to that, Byline Bancorp is 1.01 times more volatile than BancFirst. It trades about -0.04 of its total potential returns per unit of risk. BancFirst is currently generating about 0.1 per unit of volatility. If you would invest 11,680 in BancFirst on October 20, 2024 and sell it today you would earn a total of 295.00 from holding BancFirst or generate 2.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Byline Bancorp vs. BancFirst
Performance |
| Timeline |
| Byline Bancorp |
| BancFirst |
Byline Bancorp and BancFirst Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Byline Bancorp and BancFirst
The main advantage of trading using opposite Byline Bancorp and BancFirst positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Byline Bancorp position performs unexpectedly, BancFirst 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 BancFirst will offset losses from the drop in BancFirst's long position.| Byline Bancorp vs. Affinity Bancshares | Byline Bancorp vs. Home Federal Bancorp | Byline Bancorp vs. LINKBANCORP | Byline Bancorp vs. Bankwell Financial Group |
| BancFirst vs. Glacier Bancorp | BancFirst vs. BOK Financial | BancFirst vs. First Financial Bancorp | BancFirst vs. First Bancorp |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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