Correlation Between BayCom Corp and Chemung Financial

Can any of the company-specific risk be diversified away by investing in both BayCom Corp and Chemung Financial 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 BayCom Corp and Chemung Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BayCom Corp and Chemung Financial Corp, you can compare the effects of market volatilities on BayCom Corp and Chemung Financial 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 BayCom Corp with a short position of Chemung Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of BayCom Corp and Chemung Financial.

Diversification Opportunities for BayCom Corp and Chemung Financial

0.65

Correlation Coefficient

BayCom Corp  Chemung Financial

Poor diversification

The 3 months correlation between BayCom and Chemung is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding BayCom Corp and Chemung Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemung Financial Corp and BayCom Corp 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 BayCom Corp are associated (or correlated) with Chemung Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemung Financial Corp has no effect on the direction of BayCom Corp i.e., BayCom Corp and Chemung Financial go up and down completely randomly.

Pair Corralation between BayCom Corp and Chemung Financial

Given the investment horizon of 90 days BayCom Corp is expected to generate 2.57 times less return on investment than Chemung Financial. But when comparing it to its historical volatility, BayCom Corp is 1.11 times less risky than Chemung Financial. It trades about 0.03 of its potential returns per unit of risk. Chemung Financial Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  4,590  in Chemung Financial Corp on May 4, 2025 and sell it today you would earn a total of  324.00  from holding Chemung Financial Corp or generate 7.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

BayCom Corp  vs.  Chemung Financial Corp

BayCom Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in BayCom Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent primary indicators, BayCom Corp is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Chemung Financial Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Chemung Financial Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent primary indicators, Chemung Financial may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with BayCom Corp and Chemung Financial

The main advantage of trading using opposite BayCom Corp and Chemung Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BayCom Corp position performs unexpectedly, Chemung Financial 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 Chemung Financial will offset losses from the drop in Chemung Financial's long position.

The idea behind BayCom Corp and Chemung Financial Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.