Correlation Between Byline Bancorp and KeyCorp
Can any of the company-specific risk be diversified away by investing in both Byline Bancorp and KeyCorp 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 Byline Bancorp and KeyCorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Byline Bancorp and KeyCorp, you can compare the effects of market volatilities on Byline Bancorp and KeyCorp 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 Byline Bancorp with a short position of KeyCorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Byline Bancorp and KeyCorp.
Diversification Opportunities for Byline Bancorp and KeyCorp
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Byline and KeyCorp is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Byline Bancorp and KeyCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KeyCorp and Byline Bancorp 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 Byline Bancorp are associated (or correlated) with KeyCorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KeyCorp has no effect on the direction of Byline Bancorp i.e., Byline Bancorp and KeyCorp go up and down completely randomly.
Pair Corralation between Byline Bancorp and KeyCorp
Allowing for the 90-day total investment horizon Byline Bancorp is expected to generate 2.86 times more return on investment than KeyCorp. However, Byline Bancorp is 2.86 times more volatile than KeyCorp. It trades about 0.19 of its potential returns per unit of risk. KeyCorp is currently generating about 0.08 per unit of risk. If you would invest 2,409 in Byline Bancorp on April 17, 2025 and sell it today you would earn a total of 435.00 from holding Byline Bancorp or generate 18.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Byline Bancorp vs. KeyCorp
Performance |
| Timeline |
| Byline Bancorp |
| KeyCorp |
Byline Bancorp and KeyCorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Byline Bancorp and KeyCorp
The main advantage of trading using opposite Byline Bancorp and KeyCorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Byline Bancorp position performs unexpectedly, KeyCorp 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 KeyCorp will offset losses from the drop in KeyCorp's long position.| Byline Bancorp vs. LINKBANCORP | Byline Bancorp vs. Coastal Financial Corp | Byline Bancorp vs. Finward Bancorp | Byline Bancorp vs. ConnectOne 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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