Correlation Between Origin Agritech and Fifth Third
Can any of the company-specific risk be diversified away by investing in both Origin Agritech 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 Origin Agritech and Fifth Third into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and Fifth Third Bancorp, you can compare the effects of market volatilities on Origin Agritech 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 Origin Agritech with a short position of Fifth Third. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Fifth Third.
Diversification Opportunities for Origin Agritech and Fifth Third
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Origin and Fifth is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech 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 Origin Agritech 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 Origin Agritech 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 Origin Agritech i.e., Origin Agritech and Fifth Third go up and down completely randomly.
Pair Corralation between Origin Agritech and Fifth Third
Assuming the 90 days trading horizon Origin Agritech is expected to under-perform the Fifth Third. In addition to that, Origin Agritech is 1.88 times more volatile than Fifth Third Bancorp. It trades about -0.14 of its total potential returns per unit of risk. Fifth Third Bancorp is currently generating about 0.21 per unit of volatility. If you would invest 4,062 in Fifth Third Bancorp on August 25, 2024 and sell it today you would earn a total of 392.00 from holding Fifth Third Bancorp or generate 9.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Origin Agritech vs. Fifth Third Bancorp
Performance |
| Timeline |
| Origin Agritech |
| Fifth Third Bancorp |
Origin Agritech and Fifth Third Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and Fifth Third
The main advantage of trading using opposite Origin Agritech and Fifth Third positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech 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.| Origin Agritech vs. Origin Energy Limited | Origin Agritech vs. Origin Energy Limited | Origin Agritech vs. Origin Energy Limited | Origin Agritech vs. Origin Enterprises plc |
| Fifth Third vs. Regions Financial | Fifth Third vs. Superior Plus Corp | Fifth Third vs. NMI Holdings | Fifth Third vs. Origin Agritech |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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