Correlation Between Fifth Third and Bank Central
Can any of the company-specific risk be diversified away by investing in both Fifth Third and Bank Central 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 Fifth Third and Bank Central into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fifth Third Bancorp and Bank Central Asia, you can compare the effects of market volatilities on Fifth Third and Bank Central 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 Fifth Third with a short position of Bank Central. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fifth Third and Bank Central.
Diversification Opportunities for Fifth Third and Bank Central
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fifth and Bank is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Fifth Third Bancorp and Bank Central Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Central Asia and Fifth Third 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 Fifth Third Bancorp are associated (or correlated) with Bank Central. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Central Asia has no effect on the direction of Fifth Third i.e., Fifth Third and Bank Central go up and down completely randomly.
Pair Corralation between Fifth Third and Bank Central
Assuming the 90 days horizon Fifth Third is expected to generate 2.77 times less return on investment than Bank Central. But when comparing it to its historical volatility, Fifth Third Bancorp is 3.23 times less risky than Bank Central. It trades about 0.03 of its potential returns per unit of risk. Bank Central Asia is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,184 in Bank Central Asia on September 11, 2025 and sell it today you would earn a total of 22.00 from holding Bank Central Asia or generate 1.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fifth Third Bancorp vs. Bank Central Asia
Performance |
| Timeline |
| Fifth Third Bancorp |
| Bank Central Asia |
Fifth Third and Bank Central Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fifth Third and Bank Central
The main advantage of trading using opposite Fifth Third and Bank Central positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fifth Third position performs unexpectedly, Bank Central 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 Bank Central will offset losses from the drop in Bank Central's long position.| Fifth Third vs. Regions Financial | Fifth Third vs. Banco De Chile | Fifth Third vs. KeyCorp | Fifth Third vs. Woori Financial Group |
| Bank Central vs. Oversea Chinese Banking | Bank Central vs. China Citic Bank | Bank Central vs. Nordea Bank Abp | Bank Central vs. Overseas Chinese Banking |
Check out your portfolio center.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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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