Correlation Between Equity Bancshares, and Byline Bancorp
Can any of the company-specific risk be diversified away by investing in both Equity Bancshares, and Byline 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 Equity Bancshares, and Byline Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equity Bancshares, and Byline Bancorp, you can compare the effects of market volatilities on Equity Bancshares, and Byline 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 Equity Bancshares, with a short position of Byline Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equity Bancshares, and Byline Bancorp.
Diversification Opportunities for Equity Bancshares, and Byline Bancorp
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Equity and Byline is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Equity Bancshares, and Byline Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Byline Bancorp and Equity Bancshares, 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 Equity Bancshares, are associated (or correlated) with Byline Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Byline Bancorp has no effect on the direction of Equity Bancshares, i.e., Equity Bancshares, and Byline Bancorp go up and down completely randomly.
Pair Corralation between Equity Bancshares, and Byline Bancorp
Given the investment horizon of 90 days Equity Bancshares, is expected to generate 1.08 times more return on investment than Byline Bancorp. However, Equity Bancshares, is 1.08 times more volatile than Byline Bancorp. It trades about 0.09 of its potential returns per unit of risk. Byline Bancorp is currently generating about 0.07 per unit of risk. If you would invest 2,673 in Equity Bancshares, on August 26, 2024 and sell it today you would earn a total of 2,089 from holding Equity Bancshares, or generate 78.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Equity Bancshares, vs. Byline Bancorp
Performance |
| Timeline |
| Equity Bancshares, |
| Byline Bancorp |
Equity Bancshares, and Byline Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Equity Bancshares, and Byline Bancorp
The main advantage of trading using opposite Equity Bancshares, and Byline Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equity Bancshares, position performs unexpectedly, Byline 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 Byline Bancorp will offset losses from the drop in Byline Bancorp's long position.| Equity Bancshares, vs. Brookline Bancorp | Equity Bancshares, vs. Kearny Financial Corp | Equity Bancshares, vs. Heritage Financial | Equity Bancshares, vs. FVCBankcorp |
| Byline Bancorp vs. Fifth Third Bancorp | Byline Bancorp vs. Zions Bancorporation | Byline Bancorp vs. Huntington Bancshares Incorporated | Byline Bancorp vs. PNC Financial Services |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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