Correlation Between ConnectOne Bancorp and Synnex

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

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

Diversification Opportunities for ConnectOne Bancorp and Synnex

0.59

Correlation Coefficient

ConnectOne Bancorp  Synnex

Very weak diversification

The 3 months correlation between ConnectOne and Synnex is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding ConnectOne Bancorp and Synnex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synnex and ConnectOne 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 ConnectOne Bancorp are associated (or correlated) with Synnex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synnex has no effect on the direction of ConnectOne Bancorp i.e., ConnectOne Bancorp and Synnex go up and down completely randomly.

Pair Corralation between ConnectOne Bancorp and Synnex

Given the investment horizon of 90 days ConnectOne Bancorp is expected to under-perform the Synnex. In addition to that, ConnectOne Bancorp is 1.1 times more volatile than Synnex. It trades about -0.01 of its total potential returns per unit of risk. Synnex is currently generating about 0.23 per unit of volatility. If you would invest  11,384  in Synnex on May 6, 2025 and sell it today you would earn a total of  2,833  from holding Synnex or generate 24.89% return on investment over 90 days.

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

ConnectOne Bancorp  vs.  Synnex

ConnectOne Bancorp

Risk-Adjusted Performance

Very Weak

Over the last 90 days ConnectOne Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ConnectOne Bancorp is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Synnex

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Synnex are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Synnex showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ConnectOne Bancorp and Synnex

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

The idea behind ConnectOne Bancorp and Synnex 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.