Correlation Between Bankwell Financial and BayCom Corp
Can any of the company-specific risk be diversified away by investing in both Bankwell Financial 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 Bankwell Financial and BayCom Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bankwell Financial Group and BayCom Corp, you can compare the effects of market volatilities on Bankwell Financial 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 Bankwell Financial with a short position of BayCom Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankwell Financial and BayCom Corp.
Diversification Opportunities for Bankwell Financial and BayCom Corp
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bankwell and BayCom is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Bankwell Financial Group and BayCom Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BayCom Corp and Bankwell Financial 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 Bankwell Financial Group 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 Bankwell Financial i.e., Bankwell Financial and BayCom Corp go up and down completely randomly.
Pair Corralation between Bankwell Financial and BayCom Corp
Given the investment horizon of 90 days Bankwell Financial Group is expected to generate 0.88 times more return on investment than BayCom Corp. However, Bankwell Financial Group is 1.14 times less risky than BayCom Corp. It trades about 0.05 of its potential returns per unit of risk. BayCom Corp is currently generating about 0.04 per unit of risk. If you would invest 4,305 in Bankwell Financial Group on October 7, 2025 and sell it today you would earn a total of 201.00 from holding Bankwell Financial Group or generate 4.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bankwell Financial Group vs. BayCom Corp
Performance |
| Timeline |
| Bankwell Financial |
| BayCom Corp |
Bankwell Financial and BayCom Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankwell Financial and BayCom Corp
The main advantage of trading using opposite Bankwell Financial and BayCom Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankwell Financial 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.| Bankwell Financial vs. US Century Bank | Bankwell Financial vs. RBB Bancorp | Bankwell Financial vs. Orange County Bancorp | Bankwell Financial vs. Farmers Merchants Bancorp |
| BayCom Corp vs. PCB Bancorp | BayCom Corp vs. Citizens Northern Corp | BayCom Corp vs. Waterstone Financial | BayCom Corp vs. FS 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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