Correlation Between BankUnited and Fifth Third
Can any of the company-specific risk be diversified away by investing in both BankUnited 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 BankUnited and Fifth Third into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BankUnited and Fifth Third Bancorp, you can compare the effects of market volatilities on BankUnited 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 BankUnited with a short position of Fifth Third. Check out your portfolio center. Please also check ongoing floating volatility patterns of BankUnited and Fifth Third.
Diversification Opportunities for BankUnited and Fifth Third
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BankUnited and Fifth is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding BankUnited 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 BankUnited 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 BankUnited 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 BankUnited i.e., BankUnited and Fifth Third go up and down completely randomly.
Pair Corralation between BankUnited and Fifth Third
Assuming the 90 days horizon BankUnited is expected to under-perform the Fifth Third. In addition to that, BankUnited is 1.27 times more volatile than Fifth Third Bancorp. It trades about -0.28 of its total potential returns per unit of risk. Fifth Third Bancorp is currently generating about -0.11 per unit of volatility. If you would invest 4,184 in Fifth Third Bancorp on November 28, 2024 and sell it today you would lose (109.00) from holding Fifth Third Bancorp or give up 2.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
BankUnited vs. Fifth Third Bancorp
Performance |
| Timeline |
| BankUnited |
| Fifth Third Bancorp |
BankUnited and Fifth Third Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BankUnited and Fifth Third
The main advantage of trading using opposite BankUnited and Fifth Third positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BankUnited 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.| BankUnited vs. Renesas Electronics | BankUnited vs. Gol Intelligent Airlines | BankUnited vs. LPKF Laser Electronics | BankUnited vs. Schweizer Electronic AG |
| Fifth Third vs. China Southern Airlines | Fifth Third vs. International Consolidated Airlines | Fifth Third vs. JAPAN AIRLINES | Fifth Third vs. Jacquet Metal Service |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |