Correlation Between FATFISH GROUP and Fifth Third
Can any of the company-specific risk be diversified away by investing in both FATFISH GROUP 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 FATFISH GROUP and Fifth Third into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FATFISH GROUP LTD and Fifth Third Bancorp, you can compare the effects of market volatilities on FATFISH GROUP 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 FATFISH GROUP with a short position of Fifth Third. Check out your portfolio center. Please also check ongoing floating volatility patterns of FATFISH GROUP and Fifth Third.
Diversification Opportunities for FATFISH GROUP and Fifth Third
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FATFISH and Fifth is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding FATFISH GROUP LTD 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 FATFISH GROUP 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 FATFISH GROUP LTD 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 FATFISH GROUP i.e., FATFISH GROUP and Fifth Third go up and down completely randomly.
Pair Corralation between FATFISH GROUP and Fifth Third
Assuming the 90 days horizon FATFISH GROUP LTD is expected to generate 6.73 times more return on investment than Fifth Third. However, FATFISH GROUP is 6.73 times more volatile than Fifth Third Bancorp. It trades about 0.1 of its potential returns per unit of risk. Fifth Third Bancorp is currently generating about 0.31 per unit of risk. If you would invest 0.45 in FATFISH GROUP LTD on August 28, 2024 and sell it today you would earn a total of 0.05 from holding FATFISH GROUP LTD or generate 11.11% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
FATFISH GROUP LTD vs. Fifth Third Bancorp
Performance |
Timeline |
FATFISH GROUP LTD |
Fifth Third Bancorp |
FATFISH GROUP and Fifth Third Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with FATFISH GROUP and Fifth Third
The main advantage of trading using opposite FATFISH GROUP and Fifth Third positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FATFISH GROUP 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.FATFISH GROUP vs. Unity Software | FATFISH GROUP vs. Addus HomeCare | FATFISH GROUP vs. Autohome ADR | FATFISH GROUP vs. LGI Homes |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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