Correlation Between Axway Software and Marsh McLennan
Can any of the company-specific risk be diversified away by investing in both Axway Software and Marsh McLennan 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 Axway Software and Marsh McLennan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axway Software SA and Marsh McLennan Companies, you can compare the effects of market volatilities on Axway Software and Marsh McLennan 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 Axway Software with a short position of Marsh McLennan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axway Software and Marsh McLennan.
Diversification Opportunities for Axway Software and Marsh McLennan
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Axway and Marsh is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Axway Software SA and Marsh McLennan Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marsh McLennan Companies and Axway Software 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 Axway Software SA are associated (or correlated) with Marsh McLennan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marsh McLennan Companies has no effect on the direction of Axway Software i.e., Axway Software and Marsh McLennan go up and down completely randomly.
Pair Corralation between Axway Software and Marsh McLennan
Assuming the 90 days trading horizon Axway Software SA is expected to under-perform the Marsh McLennan. In addition to that, Axway Software is 1.27 times more volatile than Marsh McLennan Companies. It trades about -0.04 of its total potential returns per unit of risk. Marsh McLennan Companies is currently generating about 0.15 per unit of volatility. If you would invest 20,300 in Marsh McLennan Companies on October 29, 2024 and sell it today you would earn a total of 560.00 from holding Marsh McLennan Companies or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axway Software SA vs. Marsh McLennan Companies
Performance |
| Timeline |
| Axway Software SA |
| Marsh McLennan Companies |
Axway Software and Marsh McLennan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axway Software and Marsh McLennan
The main advantage of trading using opposite Axway Software and Marsh McLennan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axway Software position performs unexpectedly, Marsh McLennan 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 Marsh McLennan will offset losses from the drop in Marsh McLennan's long position.| Axway Software vs. SCANDMEDICAL SOLDK 040 | Axway Software vs. Peijia Medical Limited | Axway Software vs. Japan Medical Dynamic | Axway Software vs. H2O Retailing |
| Marsh McLennan vs. Axway Software SA | Marsh McLennan vs. GBS Software AG | Marsh McLennan vs. China BlueChemical | Marsh McLennan vs. PTT Global Chemical |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |