Western Alliance Bancorporation Preferred Stock Volatility
| WAL-PA Preferred Stock | USD 21.44 0.07 0.33% |
At this point, Western Alliance is very steady. Western Alliance Ban shows Sharpe Ratio of 0.12, which attests that the company had a 0.12% return per unit of risk over the last 3 months. We have found thirty technical indicators for Western Alliance Ban, which you can use to evaluate the volatility of the company. Please check out Western Alliance's Mean Deviation of 0.872, downside deviation of 1.17, and Market Risk Adjusted Performance of 0.3913 to validate if the risk estimate we provide is consistent with the expected return of 0.13%. Key indicators related to Western Alliance's volatility include:
60 Days Market Risk | Chance Of Distress | 60 Days Economic Sensitivity |
Western Alliance Preferred Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Western daily returns, and it is calculated using variance and standard deviation. We also use Western's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Western Alliance volatility.
Western |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Western Alliance can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game as hey may decide to buy additional stocks of Western Alliance at lower prices to lower their average cost per share. Similarly, when the prices of Western Alliance's stock rise, investors can sell out and invest the proceeds in other equities with better opportunities.
Moving together with Western Preferred Stock
| 0.67 | AX | Axos Financial | PairCorr |
| 0.68 | BY | Byline Bancorp Fiscal Year End 23rd of January 2025 | PairCorr |
| 0.75 | PB | Prosperity Bancshares Fiscal Year End 22nd of January 2025 | PairCorr |
| 0.68 | RF | Regions Financial Fiscal Year End 17th of January 2025 | PairCorr |
| 0.75 | VABK | Virginia National | PairCorr |
| 0.63 | VBNK | VersaBank Fiscal Year End 11th of December 2024 | PairCorr |
Moving against Western Preferred Stock
Western Alliance Market Sensitivity And Downside Risk
Western Alliance's beta coefficient measures the volatility of Western preferred stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Western preferred stock's returns against your selected market. In other words, Western Alliance's beta of 0.4 provides an investor with an approximation of how much risk Western Alliance preferred stock can potentially add to one of your existing portfolios. Western Alliance Bancorporation has relatively low volatility with skewness of -0.03 and kurtosis of 0.17. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Western Alliance's preferred stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Western Alliance's preferred stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Western Alliance Ban Demand TrendCheck current 90 days Western Alliance correlation with market (Dow Jones Industrial)Western Beta |
Western standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 1.14 |
It is essential to understand the difference between upside risk (as represented by Western Alliance's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Western Alliance's daily returns or price. Since the actual investment returns on holding a position in western preferred stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Western Alliance.
Western Alliance Ban Preferred Stock Volatility Analysis
Volatility refers to the frequency at which Western Alliance preferred stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Western Alliance's price changes. Investors will then calculate the volatility of Western Alliance's preferred stock to predict their future moves. A preferred stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A preferred stock with relatively stable price changes has low volatility. A highly volatile preferred stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Western Alliance's volatility:
Historical Volatility
This type of preferred stock volatility measures Western Alliance's fluctuations based on previous trends. It's commonly used to predict Western Alliance's future behavior based on its past. However, it cannot conclusively determine the future direction of the preferred stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Western Alliance's current market price. This means that the preferred stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Western Alliance's to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Western Alliance Ban Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Western Alliance Projected Return Density Against Market
Assuming the 90 days trading horizon Western Alliance has a beta of 0.4027 . This entails as returns on the market go up, Western Alliance average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Western Alliance Bancorporation will be expected to be much smaller as well.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Western Alliance or Banks sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Western Alliance's price will be affected by overall preferred stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Western preferred stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Western Alliance Bancorporation has an alpha of 0.1049, implying that it can generate a 0.1 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta). Predicted Return Density |
| Returns |
What Drives a Western Alliance Price Volatility?
Several factors can influence a preferred stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Western Alliance Preferred Stock Risk Measures
Assuming the 90 days trading horizon the coefficient of variation of Western Alliance is 851.14. The daily returns are distributed with a variance of 1.31 and standard deviation of 1.14. The mean deviation of Western Alliance Bancorporation is currently at 0.86. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.77
α | Alpha over Dow Jones | 0.10 | |
β | Beta against Dow Jones | 0.40 | |
σ | Overall volatility | 1.14 | |
Ir | Information ratio | 0.03 |
Western Alliance Preferred Stock Return Volatility
Western Alliance historical daily return volatility represents how much of Western Alliance preferred stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company assumes 1.1439% volatility of returns over the 90 days investment horizon. By contrast, Dow Jones Industrial accepts 0.7626% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Western Alliance Volatility
Volatility is a rate at which the price of Western Alliance or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Western Alliance may increase or decrease. In other words, similar to Western's beta indicator, it measures the risk of Western Alliance and helps estimate the fluctuations that may happen in a short period of time. So if prices of Western Alliance fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.Western Alliance Bancorporation operates as the bank holding company for Western Alliance Bank that provides various banking products and related services primarily in Arizona, California, and Nevada. Western Alliance Bancorporation was founded in 1994 and is headquartered in Phoenix, Arizona. WESTERN ALLIANCE operates under BanksRegional classification in the United States and is traded on New York Stock Exchange. It employs 3368 people.
Western Alliance's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Western Preferred Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Western Alliance's price varies over time.
3 ways to utilize Western Alliance's volatility to invest better
Higher Western Alliance's preferred stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Western Alliance Ban preferred stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Western Alliance Ban preferred stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Western Alliance Ban investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Western Alliance's preferred stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Western Alliance's preferred stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Western Alliance Investment Opportunity
Western Alliance Bancorporation has a volatility of 1.14 and is 1.5 times more volatile than Dow Jones Industrial. 10 percent of all equities and portfolios are less risky than Western Alliance. You can use Western Alliance Bancorporation to enhance the returns of your portfolios. The preferred stock experiences a normal upward fluctuation. Check odds of Western Alliance to be traded at $22.51 in 90 days.Modest diversification
The correlation between Western Alliance Bancorp. and DJI is 0.27 (i.e., Modest diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Western Alliance Bancorp. and DJI in the same portfolio, assuming nothing else is changed.
Western Alliance Additional Risk Indicators
The analysis of Western Alliance's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Western Alliance's investment and either accepting that risk or mitigating it. Along with some common measures of Western Alliance preferred stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.1128 | |||
| Market Risk Adjusted Performance | 0.3913 | |||
| Mean Deviation | 0.872 | |||
| Semi Deviation | 1.05 | |||
| Downside Deviation | 1.17 | |||
| Coefficient Of Variation | 700.43 | |||
| Standard Deviation | 1.15 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential preferred stocks, we recommend comparing similar preferred stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Western Alliance Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Western Alliance as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Western Alliance's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Western Alliance's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Western Alliance Bancorporation.
Complementary Tools for Western Preferred Stock analysis
When running Western Alliance's price analysis, check to measure Western Alliance's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Western Alliance is operating at the current time. Most of Western Alliance's value examination focuses on studying past and present price action to predict the probability of Western Alliance's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Western Alliance's price. Additionally, you may evaluate how the addition of Western Alliance to your portfolios can decrease your overall portfolio volatility.
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