Correlation Between Axos Financial and FB Financial
Can any of the company-specific risk be diversified away by investing in both Axos Financial and FB Financial 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 FB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axos Financial and FB Financial Corp, you can compare the effects of market volatilities on Axos Financial and FB Financial 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 FB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axos Financial and FB Financial.
Diversification Opportunities for Axos Financial and FB Financial
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Axos and FBK is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and FB Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FB Financial Corp 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 FB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FB Financial Corp has no effect on the direction of Axos Financial i.e., Axos Financial and FB Financial go up and down completely randomly.
Pair Corralation between Axos Financial and FB Financial
Allowing for the 90-day total investment horizon Axos Financial is expected to generate 2.36 times less return on investment than FB Financial. In addition to that, Axos Financial is 1.29 times more volatile than FB Financial Corp. It trades about 0.05 of its total potential returns per unit of risk. FB Financial Corp is currently generating about 0.15 per unit of volatility. If you would invest 5,054 in FB Financial Corp on November 3, 2024 and sell it today you would earn a total of 227.00 from holding FB Financial Corp or generate 4.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axos Financial vs. FB Financial Corp
Performance |
| Timeline |
| Axos Financial |
| FB Financial Corp |
Axos Financial and FB Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axos Financial and FB Financial
The main advantage of trading using opposite Axos Financial and FB Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axos Financial position performs unexpectedly, FB Financial 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 FB Financial will offset losses from the drop in FB Financial'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 |
| FB Financial vs. Home Bancorp | FB Financial vs. First Business Financial | FB Financial vs. LINKBANCORP | FB Financial vs. Great Southern Bancorp |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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