Correlation Between Byline Bancorp and Bank7 Corp
Can any of the company-specific risk be diversified away by investing in both Byline Bancorp and Bank7 Corp 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 Bank7 Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Byline Bancorp and Bank7 Corp, you can compare the effects of market volatilities on Byline Bancorp and Bank7 Corp 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 Bank7 Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Byline Bancorp and Bank7 Corp.
Diversification Opportunities for Byline Bancorp and Bank7 Corp
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Byline and Bank7 is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Byline Bancorp and Bank7 Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank7 Corp 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 Bank7 Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank7 Corp has no effect on the direction of Byline Bancorp i.e., Byline Bancorp and Bank7 Corp go up and down completely randomly.
Pair Corralation between Byline Bancorp and Bank7 Corp
Allowing for the 90-day total investment horizon Byline Bancorp is expected to generate 1.6 times less return on investment than Bank7 Corp. But when comparing it to its historical volatility, Byline Bancorp is 1.07 times less risky than Bank7 Corp. It trades about 0.05 of its potential returns per unit of risk. Bank7 Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,480 in Bank7 Corp on August 28, 2024 and sell it today you would earn a total of 2,309 from holding Bank7 Corp or generate 93.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Byline Bancorp vs. Bank7 Corp
Performance |
| Timeline |
| Byline Bancorp |
| Bank7 Corp |
Byline Bancorp and Bank7 Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Byline Bancorp and Bank7 Corp
The main advantage of trading using opposite Byline Bancorp and Bank7 Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Byline Bancorp position performs unexpectedly, Bank7 Corp 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 Bank7 Corp will offset losses from the drop in Bank7 Corp's long position.| Byline Bancorp vs. Affinity Bancshares | Byline Bancorp vs. Home Federal Bancorp | Byline Bancorp vs. LINKBANCORP | Byline Bancorp vs. Bankwell Financial Group |
| Bank7 Corp vs. Home Federal Bancorp | Bank7 Corp vs. First Financial Northwest | Bank7 Corp vs. First Northwest Bancorp | Bank7 Corp vs. First Capital |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |