Correlation Between Citigroup and Fifth Third

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Citigroup 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 Citigroup and Fifth Third into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citigroup and Fifth Third Bancorp, you can compare the effects of market volatilities on Citigroup 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 Citigroup with a short position of Fifth Third. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citigroup and Fifth Third.

Diversification Opportunities for Citigroup and Fifth Third

0.47
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Citigroup and Fifth is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Citigroup 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 Citigroup 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 Citigroup 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 Citigroup i.e., Citigroup and Fifth Third go up and down completely randomly.

Pair Corralation between Citigroup and Fifth Third

Taking into account the 90-day investment horizon Citigroup is expected to generate 0.68 times more return on investment than Fifth Third. However, Citigroup is 1.47 times less risky than Fifth Third. It trades about 0.06 of its potential returns per unit of risk. Fifth Third Bancorp is currently generating about 0.02 per unit of risk. If you would invest  4,572  in Citigroup on December 20, 2023 and sell it today you would earn a total of  1,291  from holding Citigroup or generate 28.24% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Citigroup  vs.  Fifth Third Bancorp

 Performance 
       Timeline  
Citigroup 

Risk-Adjusted Performance

17 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Citigroup are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, Citigroup exhibited solid returns over the last few months and may actually be approaching a breakup point.
Fifth Third Bancorp 

Risk-Adjusted Performance

5 of 100

 
Low
 
High
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Fifth Third Bancorp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Fifth Third may actually be approaching a critical reversion point that can send shares even higher in April 2024.

Citigroup and Fifth Third Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Citigroup and Fifth Third

The main advantage of trading using opposite Citigroup and Fifth Third positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citigroup 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.
The idea behind Citigroup and Fifth Third Bancorp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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

ETF Categories
List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
USA ETFs
Find actively traded Exchange Traded Funds (ETF) in USA
Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
Stocks Directory
Find actively traded stocks across global markets
FinTech Suite
Use AI to screen and filter profitable investment opportunities
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Analyst Advice
Analyst recommendations and target price estimates broken down by several categories