Correlation Between Fundamental Global and AXA SA
Can any of the company-specific risk be diversified away by investing in both Fundamental Global and AXA SA 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 Fundamental Global and AXA SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fundamental Global and AXA SA, you can compare the effects of market volatilities on Fundamental Global and AXA SA 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 Fundamental Global with a short position of AXA SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fundamental Global and AXA SA.
Diversification Opportunities for Fundamental Global and AXA SA
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Fundamental and AXA is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Fundamental Global and AXA SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AXA SA and Fundamental Global 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 Fundamental Global are associated (or correlated) with AXA SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AXA SA has no effect on the direction of Fundamental Global i.e., Fundamental Global and AXA SA go up and down completely randomly.
Pair Corralation between Fundamental Global and AXA SA
Assuming the 90 days horizon Fundamental Global is expected to generate 2.4 times less return on investment than AXA SA. In addition to that, Fundamental Global is 1.55 times more volatile than AXA SA. It trades about 0.02 of its total potential returns per unit of risk. AXA SA is currently generating about 0.06 per unit of volatility. If you would invest 3,023 in AXA SA on November 9, 2024 and sell it today you would earn a total of 836.00 from holding AXA SA or generate 27.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.38% |
| Values | Daily Returns |
Fundamental Global vs. AXA SA
Performance |
| Timeline |
| Fundamental Global |
| AXA SA |
Fundamental Global and AXA SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fundamental Global and AXA SA
The main advantage of trading using opposite Fundamental Global and AXA SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fundamental Global position performs unexpectedly, AXA SA 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 AXA SA will offset losses from the drop in AXA SA's long position.| Fundamental Global vs. FAT Brands | Fundamental Global vs. Fortress Biotech Pref | Fundamental Global vs. Fulton Financial |
| AXA SA vs. Assicurazioni Generali SpA | AXA SA vs. Athene Holding | AXA SA vs. Athene Holding | AXA SA vs. Arch Capital Group |
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 .
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