Correlation Between Axa SA and Aegon NV
Can any of the company-specific risk be diversified away by investing in both Axa SA and Aegon NV 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 Axa SA and Aegon NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axa SA ADR and Aegon NV, you can compare the effects of market volatilities on Axa SA and Aegon NV 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 Axa SA with a short position of Aegon NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axa SA and Aegon NV.
Diversification Opportunities for Axa SA and Aegon NV
Excellent diversification
The 3 months correlation between Axa and Aegon is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Axa SA ADR and Aegon NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegon NV and Axa SA 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 Axa SA ADR are associated (or correlated) with Aegon NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegon NV has no effect on the direction of Axa SA i.e., Axa SA and Aegon NV go up and down completely randomly.
Pair Corralation between Axa SA and Aegon NV
If you would invest 618.00 in Aegon NV on September 5, 2024 and sell it today you would earn a total of 0.00 from holding Aegon NV or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axa SA ADR vs. Aegon NV
Performance |
| Timeline |
| Axa SA ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Aegon NV |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Axa SA and Aegon NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axa SA and Aegon NV
The main advantage of trading using opposite Axa SA and Aegon NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axa SA position performs unexpectedly, Aegon NV 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 Aegon NV will offset losses from the drop in Aegon NV's long position.The idea behind Axa SA ADR and Aegon NV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Aegon NV vs. CECO Environmental Corp | Aegon NV vs. Omni Health | Aegon NV vs. Sonida Senior Living | Aegon NV vs. Franklin Credit Management |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |