Correlation Between Huntington Bancshares and Fifth Third
Can any of the company-specific risk be diversified away by investing in both Huntington Bancshares 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 Huntington Bancshares and Fifth Third into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huntington Bancshares Incorporated and Fifth Third Bancorp, you can compare the effects of market volatilities on Huntington Bancshares 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 Huntington Bancshares with a short position of Fifth Third. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huntington Bancshares and Fifth Third.
Diversification Opportunities for Huntington Bancshares and Fifth Third
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Huntington and Fifth is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Huntington Bancshares Incorpor 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 Huntington Bancshares 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 Huntington Bancshares Incorporated 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 Huntington Bancshares i.e., Huntington Bancshares and Fifth Third go up and down completely randomly.
Pair Corralation between Huntington Bancshares and Fifth Third
Assuming the 90 days horizon Huntington Bancshares Incorporated is expected to generate 1.95 times more return on investment than Fifth Third. However, Huntington Bancshares is 1.95 times more volatile than Fifth Third Bancorp. It trades about 0.03 of its potential returns per unit of risk. Fifth Third Bancorp is currently generating about 0.04 per unit of risk. If you would invest 1,645 in Huntington Bancshares Incorporated on August 24, 2024 and sell it today you would earn a total of 270.00 from holding Huntington Bancshares Incorporated or generate 16.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huntington Bancshares Incorpor vs. Fifth Third Bancorp
Performance |
| Timeline |
| Huntington Bancshares |
| Fifth Third Bancorp |
Huntington Bancshares and Fifth Third Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huntington Bancshares and Fifth Third
The main advantage of trading using opposite Huntington Bancshares and Fifth Third positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huntington Bancshares 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.| Huntington Bancshares vs. Fifth Third Bancorp | Huntington Bancshares vs. Huntington Bancshares Incorporated | Huntington Bancshares vs. Washington Federal | Huntington Bancshares vs. Fifth Third Bancorp |
| Fifth Third vs. Capital One Financial | Fifth Third vs. Capital One Financial | Fifth Third vs. Bank of America | Fifth Third vs. KeyCorp |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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