Correlation Between Axa Equitable and Flex
Can any of the company-specific risk be diversified away by investing in both Axa Equitable and Flex 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 Equitable and Flex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axa Equitable Holdings and Flex, you can compare the effects of market volatilities on Axa Equitable and Flex 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 Equitable with a short position of Flex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axa Equitable and Flex.
Diversification Opportunities for Axa Equitable and Flex
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Axa and Flex is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Axa Equitable Holdings and Flex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Flex and Axa Equitable 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 Equitable Holdings are associated (or correlated) with Flex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Flex has no effect on the direction of Axa Equitable i.e., Axa Equitable and Flex go up and down completely randomly.
Pair Corralation between Axa Equitable and Flex
Considering the 90-day investment horizon Axa Equitable is expected to generate 2.46 times less return on investment than Flex. But when comparing it to its historical volatility, Axa Equitable Holdings is 2.08 times less risky than Flex. It trades about 0.07 of its potential returns per unit of risk. Flex is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,112 in Flex on November 2, 2024 and sell it today you would earn a total of 3,096 from holding Flex or generate 278.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Axa Equitable Holdings vs. Flex
Performance |
| Timeline |
| Axa Equitable Holdings |
| Flex |
Axa Equitable and Flex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axa Equitable and Flex
The main advantage of trading using opposite Axa Equitable and Flex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axa Equitable position performs unexpectedly, Flex 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 Flex will offset losses from the drop in Flex's long position.| Axa Equitable vs. American International Group | Axa Equitable vs. Arch Capital Group | Axa Equitable vs. Old Republic International | Axa Equitable vs. Sun Life Financial |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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