Correlation Between Axos Financial and FNB
Can any of the company-specific risk be diversified away by investing in both Axos Financial and FNB 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 FNB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axos Financial and FNB Inc, you can compare the effects of market volatilities on Axos Financial and FNB 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 FNB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axos Financial and FNB.
Diversification Opportunities for Axos Financial and FNB
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Axos and FNB is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and FNB Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FNB Inc 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 FNB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FNB Inc has no effect on the direction of Axos Financial i.e., Axos Financial and FNB go up and down completely randomly.
Pair Corralation between Axos Financial and FNB
Allowing for the 90-day total investment horizon Axos Financial is expected to generate 1.79 times more return on investment than FNB. However, Axos Financial is 1.79 times more volatile than FNB Inc. It trades about 0.11 of its potential returns per unit of risk. FNB Inc is currently generating about 0.08 per unit of risk. If you would invest 6,880 in Axos Financial on August 28, 2024 and sell it today you would earn a total of 1,559 from holding Axos Financial or generate 22.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Axos Financial vs. FNB Inc
Performance |
| Timeline |
| Axos Financial |
| FNB Inc |
Axos Financial and FNB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axos Financial and FNB
The main advantage of trading using opposite Axos Financial and FNB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axos Financial position performs unexpectedly, FNB 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 FNB will offset losses from the drop in FNB's long position.| Axos Financial vs. Fifth Third Bancorp | Axos Financial vs. Huntington Bancshares Incorporated | Axos Financial vs. MT Bank |
| FNB vs. Century Financial Corp | FNB vs. Apollo Bancorp | FNB vs. Commercial National Financial | FNB vs. Eastern Michigan Financial |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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