Correlation Between International General and Axa Equitable
Can any of the company-specific risk be diversified away by investing in both International General and Axa Equitable 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 International General and Axa Equitable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International General Insurance and Axa Equitable Holdings, you can compare the effects of market volatilities on International General and Axa Equitable 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 International General with a short position of Axa Equitable. Check out your portfolio center. Please also check ongoing floating volatility patterns of International General and Axa Equitable.
Diversification Opportunities for International General and Axa Equitable
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between International and Axa is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding International General Insuranc and Axa Equitable Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axa Equitable Holdings and International General 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 International General Insurance are associated (or correlated) with Axa Equitable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axa Equitable Holdings has no effect on the direction of International General i.e., International General and Axa Equitable go up and down completely randomly.
Pair Corralation between International General and Axa Equitable
Given the investment horizon of 90 days International General Insurance is expected to generate 0.8 times more return on investment than Axa Equitable. However, International General Insurance is 1.24 times less risky than Axa Equitable. It trades about 0.28 of its potential returns per unit of risk. Axa Equitable Holdings is currently generating about 0.11 per unit of risk. If you would invest 2,224 in International General Insurance on August 28, 2024 and sell it today you would earn a total of 364.00 from holding International General Insurance or generate 16.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
International General Insuranc vs. Axa Equitable Holdings
Performance |
| Timeline |
| International General |
| Axa Equitable Holdings |
International General and Axa Equitable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International General and Axa Equitable
The main advantage of trading using opposite International General and Axa Equitable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International General position performs unexpectedly, Axa Equitable 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 Equitable will offset losses from the drop in Axa Equitable's long position.| International General vs. Enstar Group Limited | International General vs. Axa Equitable Holdings | International General vs. Arch Capital Group | International General vs. Waterdrop ADR |
| 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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