Correlation Between BOK Financial and First Guaranty

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

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

Diversification Opportunities for BOK Financial and First Guaranty

0.2

Correlation Coefficient

BOK Financial  First Guaranty

Modest diversification

The 3 months correlation between BOK and First is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding BOK Financial and First Guaranty Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Guaranty Bancshares and BOK 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 BOK Financial are associated (or correlated) with First Guaranty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Guaranty Bancshares has no effect on the direction of BOK Financial i.e., BOK Financial and First Guaranty go up and down completely randomly.

Pair Corralation between BOK Financial and First Guaranty

Given the investment horizon of 90 days BOK Financial is expected to generate 0.59 times more return on investment than First Guaranty. However, BOK Financial is 1.69 times less risky than First Guaranty. It trades about 0.14 of its potential returns per unit of risk. First Guaranty Bancshares is currently generating about -0.05 per unit of risk. If you would invest  9,315  in BOK Financial on May 1, 2025 and sell it today you would earn a total of  1,201  from holding BOK Financial or generate 12.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

BOK Financial  vs.  First Guaranty Bancshares

BOK Financial

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BOK Financial are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating forward-looking signals, BOK Financial reported solid returns over the last few months and may actually be approaching a breakup point.

First Guaranty Bancshares

Risk-Adjusted Performance

Very Weak

Over the last 90 days First Guaranty Bancshares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental drivers remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with BOK Financial and First Guaranty

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

The idea behind BOK Financial and First Guaranty Bancshares 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.