Correlation Between Byline Bancorp and TC Bancshares
Can any of the company-specific risk be diversified away by investing in both Byline Bancorp and TC Bancshares 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 TC Bancshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Byline Bancorp and TC Bancshares, you can compare the effects of market volatilities on Byline Bancorp and TC Bancshares 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 TC Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Byline Bancorp and TC Bancshares.
Diversification Opportunities for Byline Bancorp and TC Bancshares
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Byline and TCBC is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Byline Bancorp and TC Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TC Bancshares 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 TC Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TC Bancshares has no effect on the direction of Byline Bancorp i.e., Byline Bancorp and TC Bancshares go up and down completely randomly.
Pair Corralation between Byline Bancorp and TC Bancshares
Allowing for the 90-day total investment horizon Byline Bancorp is expected to generate 1.24 times more return on investment than TC Bancshares. However, Byline Bancorp is 1.24 times more volatile than TC Bancshares. It trades about 0.05 of its potential returns per unit of risk. TC Bancshares is currently generating about -0.01 per unit of risk. If you would invest 2,186 in Byline Bancorp on August 28, 2024 and sell it today you would earn a total of 991.00 from holding Byline Bancorp or generate 45.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 84.07% |
| Values | Daily Returns |
Byline Bancorp vs. TC Bancshares
Performance |
| Timeline |
| Byline Bancorp |
| TC Bancshares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Byline Bancorp and TC Bancshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Byline Bancorp and TC Bancshares
The main advantage of trading using opposite Byline Bancorp and TC Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Byline Bancorp position performs unexpectedly, TC Bancshares 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 TC Bancshares will offset losses from the drop in TC Bancshares' long position.| Byline Bancorp vs. Fifth Third Bancorp | Byline Bancorp vs. Huntington Bancshares Incorporated | Byline Bancorp vs. MT Bank |
| TC Bancshares vs. Home Federal Bancorp | TC Bancshares vs. Lake Shore Bancorp | TC Bancshares vs. Community West Bancshares | TC Bancshares vs. First Financial Northwest |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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