Correlation Between Bogota Financial and Fifth Third
Can any of the company-specific risk be diversified away by investing in both Bogota Financial and Fifth Third 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 Bogota Financial and Fifth Third into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bogota Financial Corp and Fifth Third Bancorp, you can compare the effects of market volatilities on Bogota Financial and Fifth Third 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 Bogota Financial with a short position of Fifth Third. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bogota Financial and Fifth Third.
Diversification Opportunities for Bogota Financial and Fifth Third
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bogota and Fifth is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Bogota Financial Corp and Fifth Third Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fifth Third Bancorp and Bogota 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 Bogota Financial Corp are associated (or correlated) with Fifth Third. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fifth Third Bancorp has no effect on the direction of Bogota Financial i.e., Bogota Financial and Fifth Third go up and down completely randomly.
Pair Corralation between Bogota Financial and Fifth Third
Given the investment horizon of 90 days Bogota Financial Corp is expected to generate 0.92 times more return on investment than Fifth Third. However, Bogota Financial Corp is 1.08 times less risky than Fifth Third. It trades about 0.11 of its potential returns per unit of risk. Fifth Third Bancorp is currently generating about -0.03 per unit of risk. If you would invest 677.00 in Bogota Financial Corp on February 29, 2024 and sell it today you would earn a total of 18.00 from holding Bogota Financial Corp or generate 2.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Bogota Financial Corp vs. Fifth Third Bancorp
Performance |
Timeline |
Bogota Financial Corp |
Fifth Third Bancorp |
Bogota Financial and Fifth Third Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bogota Financial and Fifth Third
The main advantage of trading using opposite Bogota Financial and Fifth Third positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bogota Financial position performs unexpectedly, Fifth Third 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 Fifth Third will offset losses from the drop in Fifth Third's long position.Bogota Financial vs. Heritage Commerce Corp | Bogota Financial vs. Westamerica Bancorporation | Bogota Financial vs. Heritage Financial | Bogota Financial vs. Cambridge Bancorp |
Fifth Third vs. Heritage Commerce Corp | Fifth Third vs. Westamerica Bancorporation | Fifth Third vs. Heritage Financial | Fifth Third vs. Cambridge Bancorp |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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