Correlation Between American Axle and Investors Bancorp
Can any of the company-specific risk be diversified away by investing in both American Axle and Investors Bancorp 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 American Axle and Investors Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Axle Manufacturing and Investors Bancorp, you can compare the effects of market volatilities on American Axle and Investors Bancorp 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 American Axle with a short position of Investors Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Axle and Investors Bancorp.
Diversification Opportunities for American Axle and Investors Bancorp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Investors is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Axle Manufacturing and Investors Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investors Bancorp and American Axle 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 American Axle Manufacturing are associated (or correlated) with Investors Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investors Bancorp has no effect on the direction of American Axle i.e., American Axle and Investors Bancorp go up and down completely randomly.
Pair Corralation between American Axle and Investors Bancorp
If you would invest (100.00) in Investors Bancorp on September 14, 2024 and sell it today you would earn a total of 100.00 from holding Investors Bancorp or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
American Axle Manufacturing vs. Investors Bancorp
Performance |
| Timeline |
| American Axle Manufa |
| Investors Bancorp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Axle and Investors Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Axle and Investors Bancorp
The main advantage of trading using opposite American Axle and Investors Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Axle position performs unexpectedly, Investors Bancorp 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 Investors Bancorp will offset losses from the drop in Investors Bancorp's long position.| American Axle vs. Ford Motor | American Axle vs. General Motors | American Axle vs. Goodyear Tire Rubber | American Axle vs. Li Auto |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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