Correlation Between Axos Financial and Invesco Municipal
Can any of the company-specific risk be diversified away by investing in both Axos Financial and Invesco 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 Invesco 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 Invesco Municipal Trust, you can compare the effects of market volatilities on Axos Financial and Invesco 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 Invesco Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axos Financial and Invesco Municipal.
Diversification Opportunities for Axos Financial and Invesco Municipal
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Axos and Invesco is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and Invesco Municipal Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Municipal Trust 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 Invesco Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Municipal Trust has no effect on the direction of Axos Financial i.e., Axos Financial and Invesco Municipal go up and down completely randomly.
Pair Corralation between Axos Financial and Invesco Municipal
Allowing for the 90-day total investment horizon Axos Financial is expected to generate 4.13 times more return on investment than Invesco Municipal. However, Axos Financial is 4.13 times more volatile than Invesco Municipal Trust. It trades about 0.07 of its potential returns per unit of risk. Invesco Municipal Trust is currently generating about 0.05 per unit of risk. If you would invest 3,883 in Axos Financial on August 30, 2024 and sell it today you would earn a total of 4,495 from holding Axos Financial or generate 115.76% 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. Invesco Municipal Trust
Performance |
| Timeline |
| Axos Financial |
| Invesco Municipal Trust |
Axos Financial and Invesco Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axos Financial and Invesco Municipal
The main advantage of trading using opposite Axos Financial and Invesco Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axos Financial position performs unexpectedly, Invesco 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 Invesco Municipal will offset losses from the drop in Invesco 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 |
| Invesco Municipal vs. Invesco Trust For | Invesco Municipal vs. Invesco Quality Municipal | Invesco Municipal vs. Invesco Municipal Opportunity | Invesco 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |