Correlation Between American Axle and Airspan Networks
Can any of the company-specific risk be diversified away by investing in both American Axle and Airspan Networks 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 Airspan Networks 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 Airspan Networks Holdings, you can compare the effects of market volatilities on American Axle and Airspan Networks 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 Airspan Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Axle and Airspan Networks.
Diversification Opportunities for American Axle and Airspan Networks
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between American and Airspan is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding American Axle Manufacturing and Airspan Networks Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airspan Networks Holdings 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 Airspan Networks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airspan Networks Holdings has no effect on the direction of American Axle i.e., American Axle and Airspan Networks go up and down completely randomly.
Pair Corralation between American Axle and Airspan Networks
If you would invest 628.00 in American Axle Manufacturing on September 15, 2024 and sell it today you would earn a total of 48.00 from holding American Axle Manufacturing or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
American Axle Manufacturing vs. Airspan Networks Holdings
Performance |
| Timeline |
| American Axle Manufa |
| Airspan Networks Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Axle and Airspan Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Axle and Airspan Networks
The main advantage of trading using opposite American Axle and Airspan Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Axle position performs unexpectedly, Airspan Networks 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 Airspan Networks will offset losses from the drop in Airspan Networks' long position.| American Axle vs. Ford Motor | American Axle vs. General Motors | American Axle vs. Goodyear Tire Rubber | American Axle vs. Li Auto |
| Airspan Networks vs. American Axle Manufacturing | Airspan Networks vs. CarsalesCom Ltd ADR | Airspan Networks vs. Adient PLC | Airspan Networks vs. Wabash National |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |