Correlation Between Axos Financial and Putnam Municipal
Can any of the company-specific risk be diversified away by investing in both Axos Financial and Putnam Municipal 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 Putnam Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axos Financial and Putnam Municipal Opportunities, you can compare the effects of market volatilities on Axos Financial and Putnam Municipal 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 Putnam Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axos Financial and Putnam Municipal.
Diversification Opportunities for Axos Financial and Putnam Municipal
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Axos and Putnam is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and Putnam Municipal Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putnam Municipal Opp 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 Putnam Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putnam Municipal Opp has no effect on the direction of Axos Financial i.e., Axos Financial and Putnam Municipal go up and down completely randomly.
Pair Corralation between Axos Financial and Putnam Municipal
Allowing for the 90-day total investment horizon Axos Financial is expected to generate 5.39 times more return on investment than Putnam Municipal. However, Axos Financial is 5.39 times more volatile than Putnam Municipal Opportunities. It trades about 0.23 of its potential returns per unit of risk. Putnam Municipal Opportunities is currently generating about 0.11 per unit of risk. If you would invest 6,703 in Axos Financial on August 29, 2024 and sell it today you would earn a total of 1,675 from holding Axos Financial or generate 24.99% 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. Putnam Municipal Opportunities
Performance |
| Timeline |
| Axos Financial |
| Putnam Municipal Opp |
Axos Financial and Putnam Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axos Financial and Putnam Municipal
The main advantage of trading using opposite Axos Financial and Putnam Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axos Financial position performs unexpectedly, Putnam Municipal 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 Putnam Municipal will offset losses from the drop in Putnam Municipal'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 |
| Putnam Municipal vs. Invesco Municipal Income | Putnam Municipal vs. DWS Municipal Income | Putnam Municipal vs. MFS Municipal Income | Putnam Municipal vs. MFS High Income |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |