Correlation Between Westamerica Bancorporation and American National
Can any of the company-specific risk be diversified away by investing in both Westamerica Bancorporation and American National 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 Westamerica Bancorporation and American National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westamerica Bancorporation and American National Bankshares, you can compare the effects of market volatilities on Westamerica Bancorporation and American National 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 Westamerica Bancorporation with a short position of American National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westamerica Bancorporation and American National.
Diversification Opportunities for Westamerica Bancorporation and American National
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Westamerica and American is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Westamerica Bancorp. and American National Bankshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American National and Westamerica Bancorporation 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 Westamerica Bancorporation are associated (or correlated) with American National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American National has no effect on the direction of Westamerica Bancorporation i.e., Westamerica Bancorporation and American National go up and down completely randomly.
Pair Corralation between Westamerica Bancorporation and American National
If you would invest 5,233 in Westamerica Bancorporation on October 24, 2024 and sell it today you would earn a total of 8.00 from holding Westamerica Bancorporation or generate 0.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 5.56% |
| Values | Daily Returns |
Westamerica Bancorp. vs. American National Bankshares
Performance |
| Timeline |
| Westamerica Bancorporation |
| American National |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Westamerica Bancorporation and American National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westamerica Bancorporation and American National
The main advantage of trading using opposite Westamerica Bancorporation and American National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westamerica Bancorporation position performs unexpectedly, American National 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 American National will offset losses from the drop in American National's long position.| Westamerica Bancorporation vs. Heritage Commerce Corp | Westamerica Bancorporation vs. Heritage Financial | Westamerica Bancorporation vs. Penns Woods Bancorp | Westamerica Bancorporation vs. 1st Source |
| American National vs. First Northwest Bancorp | American National vs. Community West Bancshares | American National vs. First Financial Northwest | American National vs. Great Southern 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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