Correlation Between ENSTAR GROUP and AXA SA
Can any of the company-specific risk be diversified away by investing in both ENSTAR GROUP and AXA SA 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 ENSTAR GROUP and AXA SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ENSTAR GROUP LTD and AXA SA, you can compare the effects of market volatilities on ENSTAR GROUP and AXA SA 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 ENSTAR GROUP with a short position of AXA SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ENSTAR GROUP and AXA SA.
Diversification Opportunities for ENSTAR GROUP and AXA SA
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ENSTAR and AXA is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding ENSTAR GROUP LTD and AXA SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AXA SA and ENSTAR GROUP 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 ENSTAR GROUP LTD are associated (or correlated) with AXA SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AXA SA has no effect on the direction of ENSTAR GROUP i.e., ENSTAR GROUP and AXA SA go up and down completely randomly.
Pair Corralation between ENSTAR GROUP and AXA SA
Assuming the 90 days horizon ENSTAR GROUP is expected to generate 1.07 times less return on investment than AXA SA. But when comparing it to its historical volatility, ENSTAR GROUP LTD is 1.05 times less risky than AXA SA. It trades about 0.07 of its potential returns per unit of risk. AXA SA is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,642 in AXA SA on August 25, 2024 and sell it today you would earn a total of 678.00 from holding AXA SA or generate 25.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ENSTAR GROUP LTD vs. AXA SA
Performance |
| Timeline |
| ENSTAR GROUP LTD |
| AXA SA |
ENSTAR GROUP and AXA SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ENSTAR GROUP and AXA SA
The main advantage of trading using opposite ENSTAR GROUP and AXA SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ENSTAR GROUP position performs unexpectedly, AXA SA 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 AXA SA will offset losses from the drop in AXA SA's long position.| ENSTAR GROUP vs. Allianz SE | ENSTAR GROUP vs. ALLIANZ SE UNSPADR | ENSTAR GROUP vs. AXA SA | ENSTAR GROUP vs. ASSGENERALI ADR 12EO |
| AXA SA vs. Allianz SE | AXA SA vs. ALLIANZ SE UNSPADR | AXA SA vs. ASSGENERALI ADR 12EO | AXA SA vs. Principal Financial Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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