Correlation Between BC Technology and FS Bancorp

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

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

Diversification Opportunities for BC Technology and FS Bancorp

0.69

Correlation Coefficient

BC Technology  FS Bancorp

Poor diversification

The 3 months correlation between BCTCF and FSBW is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding BC Technology Group and FS Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FS Bancorp and BC Technology 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 BC Technology Group are associated (or correlated) with FS Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FS Bancorp has no effect on the direction of BC Technology i.e., BC Technology and FS Bancorp go up and down completely randomly.

Pair Corralation between BC Technology and FS Bancorp

Assuming the 90 days horizon BC Technology Group is expected to under-perform the FS Bancorp. But the pink sheet apears to be less risky and, when comparing its historical volatility, BC Technology Group is 2.16 times less risky than FS Bancorp. The pink sheet trades about -0.07 of its potential returns per unit of risk. The FS Bancorp is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  4,187  in FS Bancorp on August 31, 2025 and sell it today you would lose (92.00) from holding FS Bancorp or give up 2.2% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

BC Technology Group  vs.  FS Bancorp

BC Technology Group

Risk-Adjusted Performance

Weakest

Over the last 90 days BC Technology Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, BC Technology is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

FS Bancorp

Risk-Adjusted Performance

Weakest

Over the last 90 days FS Bancorp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental drivers, FS Bancorp is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with BC Technology and FS Bancorp

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

The idea behind BC Technology Group and FS Bancorp 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.