Correlation Between Axos Financial and Cboe Global
Can any of the company-specific risk be diversified away by investing in both Axos Financial and Cboe Global 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 Axos Financial and Cboe Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axos Financial and Cboe Global Markets, you can compare the effects of market volatilities on Axos Financial and Cboe Global 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 Axos Financial with a short position of Cboe Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axos Financial and Cboe Global.
Diversification Opportunities for Axos Financial and Cboe Global
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Axos and Cboe is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and Cboe Global Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cboe Global Markets and Axos 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 Axos Financial are associated (or correlated) with Cboe Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cboe Global Markets has no effect on the direction of Axos Financial i.e., Axos Financial and Cboe Global go up and down completely randomly.
Pair Corralation between Axos Financial and Cboe Global
Allowing for the 90-day total investment horizon Axos Financial is expected to generate 2.94 times more return on investment than Cboe Global. However, Axos Financial is 2.94 times more volatile than Cboe Global Markets. It trades about 0.23 of its potential returns per unit of risk. Cboe Global Markets is currently generating about -0.02 per unit of risk. If you would invest 6,564 in Axos Financial on August 24, 2024 and sell it today you would earn a total of 1,648 from holding Axos Financial or generate 25.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axos Financial vs. Cboe Global Markets
Performance |
| Timeline |
| Axos Financial |
| Cboe Global Markets |
Axos Financial and Cboe Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axos Financial and Cboe Global
The main advantage of trading using opposite Axos Financial and Cboe Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axos Financial position performs unexpectedly, Cboe Global 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 Cboe Global will offset losses from the drop in Cboe Global's long position.| Axos Financial vs. National Bank Holdings | Axos Financial vs. Community West Bancshares | Axos Financial vs. First Capital | Axos Financial vs. Home Bancorp |
| Cboe Global vs. CME Group | Cboe Global vs. MarketAxess Holdings | Cboe Global vs. Intercontinental Exchange | Cboe Global vs. Allegion PLC |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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