Correlation Between CrossFirst Bankshares and ST Bancorp
Can any of the company-specific risk be diversified away by investing in both CrossFirst Bankshares and ST 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 CrossFirst Bankshares and ST Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CrossFirst Bankshares and ST Bancorp, you can compare the effects of market volatilities on CrossFirst Bankshares and ST 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 CrossFirst Bankshares with a short position of ST Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of CrossFirst Bankshares and ST Bancorp.
Diversification Opportunities for CrossFirst Bankshares and ST Bancorp
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CrossFirst and STBA is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding CrossFirst Bankshares and ST Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ST Bancorp and CrossFirst Bankshares 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 CrossFirst Bankshares are associated (or correlated) with ST Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ST Bancorp has no effect on the direction of CrossFirst Bankshares i.e., CrossFirst Bankshares and ST Bancorp go up and down completely randomly.
Pair Corralation between CrossFirst Bankshares and ST Bancorp
Considering the 90-day investment horizon CrossFirst Bankshares is expected to generate 1.08 times more return on investment than ST Bancorp. However, CrossFirst Bankshares is 1.08 times more volatile than ST Bancorp. It trades about 0.03 of its potential returns per unit of risk. ST Bancorp is currently generating about 0.04 per unit of risk. If you would invest 1,346 in CrossFirst Bankshares on August 24, 2024 and sell it today you would earn a total of 405.00 from holding CrossFirst Bankshares or generate 30.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CrossFirst Bankshares vs. ST Bancorp
Performance |
| Timeline |
| CrossFirst Bankshares |
| ST Bancorp |
CrossFirst Bankshares and ST Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CrossFirst Bankshares and ST Bancorp
The main advantage of trading using opposite CrossFirst Bankshares and ST Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CrossFirst Bankshares position performs unexpectedly, ST 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 ST Bancorp will offset losses from the drop in ST Bancorp's long position.| CrossFirst Bankshares vs. Home Bancorp | CrossFirst Bankshares vs. Great Southern Bancorp | CrossFirst Bankshares vs. Finward Bancorp | CrossFirst Bankshares vs. Community West Bancshares |
| ST Bancorp vs. CrossFirst Bankshares | ST Bancorp vs. Enterprise Financial Services | ST Bancorp vs. The First Bancshares, | ST Bancorp 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |