Correlation Between Woori Financial and Fifth Third
Can any of the company-specific risk be diversified away by investing in both Woori 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 Woori 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 Woori Financial Group and Fifth Third Bancorp, you can compare the effects of market volatilities on Woori 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 Woori Financial with a short position of Fifth Third. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Fifth Third.
Diversification Opportunities for Woori Financial and Fifth Third
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Woori and Fifth is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group 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 Woori 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 Woori Financial Group 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 Woori Financial i.e., Woori Financial and Fifth Third go up and down completely randomly.
Pair Corralation between Woori Financial and Fifth Third
Allowing for the 90-day total investment horizon Woori Financial is expected to generate 1.63 times less return on investment than Fifth Third. In addition to that, Woori Financial is 1.14 times more volatile than Fifth Third Bancorp. It trades about 0.07 of its total potential returns per unit of risk. Fifth Third Bancorp is currently generating about 0.13 per unit of volatility. If you would invest 2,943 in Fifth Third Bancorp on August 27, 2024 and sell it today you would earn a total of 1,847 from holding Fifth Third Bancorp or generate 62.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. Fifth Third Bancorp
Performance |
| Timeline |
| Woori Financial Group |
| Fifth Third Bancorp |
Woori Financial and Fifth Third Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Fifth Third
The main advantage of trading using opposite Woori Financial and Fifth Third positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori 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.| Woori Financial vs. Banco Santander Brasil | Woori Financial vs. CrossFirst Bankshares | Woori Financial vs. Banco Bradesco SA | Woori Financial vs. CF Bankshares |
| Fifth Third vs. KeyCorp | Fifth Third vs. Regions Financial | Fifth Third vs. Zions Bancorporation | Fifth Third vs. Huntington Bancshares Incorporated |
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 Managers module to screen money managers from public funds and ETFs managed around the world.
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