Correlation Between PCB Bancorp and Guaranty Bancshares,

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

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

Diversification Opportunities for PCB Bancorp and Guaranty Bancshares,

0.93

Correlation Coefficient

PCB Bancorp  Guaranty Bancshares,

Almost no diversification

The 3 months correlation between PCB and Guaranty is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding PCB Bancorp and Guaranty Bancshares, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guaranty Bancshares, and PCB 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 PCB Bancorp are associated (or correlated) with Guaranty Bancshares,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guaranty Bancshares, has no effect on the direction of PCB Bancorp i.e., PCB Bancorp and Guaranty Bancshares, go up and down completely randomly.

Pair Corralation between PCB Bancorp and Guaranty Bancshares,

Considering the 90-day investment horizon PCB Bancorp is expected to generate 1.13 times less return on investment than Guaranty Bancshares,. But when comparing it to its historical volatility, PCB Bancorp is 1.04 times less risky than Guaranty Bancshares,. It trades about 0.15 of its potential returns per unit of risk. Guaranty Bancshares, is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  3,947  in Guaranty Bancshares, on April 25, 2025 and sell it today you would earn a total of  652.00  from holding Guaranty Bancshares, or generate 16.52% return on investment over 90 days.

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

PCB Bancorp  vs.  Guaranty Bancshares,

PCB Bancorp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PCB Bancorp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting fundamental indicators, PCB Bancorp sustained solid returns over the last few months and may actually be approaching a breakup point.

Guaranty Bancshares,

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Guaranty Bancshares, are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Guaranty Bancshares, showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PCB Bancorp and Guaranty Bancshares,

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

The idea behind PCB Bancorp and 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.