Correlation Between Comerica and BayCom Corp
Can any of the company-specific risk be diversified away by investing in both Comerica and BayCom 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 Comerica and BayCom Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Comerica and BayCom Corp, you can compare the effects of market volatilities on Comerica and BayCom 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 Comerica with a short position of BayCom Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comerica and BayCom Corp.
Diversification Opportunities for Comerica and BayCom Corp
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Comerica and BayCom is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Comerica and BayCom Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BayCom Corp and Comerica 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 Comerica are associated (or correlated) with BayCom Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BayCom Corp has no effect on the direction of Comerica i.e., Comerica and BayCom Corp go up and down completely randomly.
Pair Corralation between Comerica and BayCom Corp
Considering the 90-day investment horizon Comerica is expected to generate 1.21 times more return on investment than BayCom Corp. However, Comerica is 1.21 times more volatile than BayCom Corp. It trades about 0.08 of its potential returns per unit of risk. BayCom Corp is currently generating about 0.08 per unit of risk. If you would invest 3,982 in Comerica on August 31, 2024 and sell it today you would earn a total of 3,243 from holding Comerica or generate 81.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Comerica vs. BayCom Corp
Performance |
| Timeline |
| Comerica |
| BayCom Corp |
Comerica and BayCom Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Comerica and BayCom Corp
The main advantage of trading using opposite Comerica and BayCom Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comerica position performs unexpectedly, BayCom 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 BayCom Corp will offset losses from the drop in BayCom Corp's long position.| Comerica vs. Western Alliance Bancorporation | Comerica vs. KeyCorp | Comerica vs. Truist Financial Corp | Comerica vs. Zions Bancorporation |
| BayCom Corp vs. Home Federal Bancorp | BayCom Corp vs. LINKBANCORP | BayCom Corp vs. Community West Bancshares | BayCom Corp vs. First Northwest 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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