Correlation Between Axos Financial and Oaktree Specialty
Can any of the company-specific risk be diversified away by investing in both Axos Financial and Oaktree Specialty 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 Oaktree Specialty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axos Financial and Oaktree Specialty Lending, you can compare the effects of market volatilities on Axos Financial and Oaktree Specialty 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 Oaktree Specialty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axos Financial and Oaktree Specialty.
Diversification Opportunities for Axos Financial and Oaktree Specialty
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Axos and Oaktree is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and Oaktree Specialty Lending in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oaktree Specialty Lending 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 Oaktree Specialty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oaktree Specialty Lending has no effect on the direction of Axos Financial i.e., Axos Financial and Oaktree Specialty go up and down completely randomly.
Pair Corralation between Axos Financial and Oaktree Specialty
Allowing for the 90-day total investment horizon Axos Financial is expected to generate 2.62 times more return on investment than Oaktree Specialty. However, Axos Financial is 2.62 times more volatile than Oaktree Specialty Lending. It trades about 0.14 of its potential returns per unit of risk. Oaktree Specialty Lending is currently generating about -0.08 per unit of risk. If you would invest 5,246 in Axos Financial on September 1, 2024 and sell it today you would earn a total of 3,039 from holding Axos Financial or generate 57.93% 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. Oaktree Specialty Lending
Performance |
| Timeline |
| Axos Financial |
| Oaktree Specialty Lending |
Axos Financial and Oaktree Specialty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axos Financial and Oaktree Specialty
The main advantage of trading using opposite Axos Financial and Oaktree Specialty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axos Financial position performs unexpectedly, Oaktree Specialty 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 Oaktree Specialty will offset losses from the drop in Oaktree Specialty'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 |
| Oaktree Specialty vs. Barings BDC | Oaktree Specialty vs. OneMain Holdings | Oaktree Specialty vs. Runway Growth Finance | Oaktree Specialty vs. Ally 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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