Correlation Between Axos Financial and First Of

Can any of the company-specific risk be diversified away by investing in both Axos Financial and First Of 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 Axos Financial and First Of into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Axos Financial and First of Long, you can compare the effects of market volatilities on Axos Financial and First Of 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 Axos Financial with a short position of First Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axos Financial and First Of.

Diversification Opportunities for Axos Financial and First Of

0.9

Correlation Coefficient

Axos Financial  First Of

Almost no diversification

The 3 months correlation between Axos and First is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and First of Long in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First of Long and Axos Financial 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 Axos Financial are associated (or correlated) with First Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First of Long has no effect on the direction of Axos Financial i.e., Axos Financial and First Of go up and down completely randomly.

Pair Corralation between Axos Financial and First Of

Allowing for the 90-day total investment horizon Axos Financial is expected to generate 1.37 times more return on investment than First Of. However, Axos Financial is 1.37 times more volatile than First of Long. It trades about 0.11 of its potential returns per unit of risk. First of Long is currently generating about 0.11 per unit of risk. If you would invest  6,815  in Axos Financial on September 3, 2024 and sell it today you would earn a total of  1,470  from holding Axos Financial or generate 21.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Axos Financial  vs.  First of Long

Axos Financial

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Axos Financial are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Axos Financial showed solid returns over the last few months and may actually be approaching a breakup point.

First of Long

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in First of Long are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady forward indicators, First Of exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Axos Financial and First Of

The main advantage of trading using opposite Axos Financial and First Of positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axos Financial position performs unexpectedly, First Of 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 First Of will offset losses from the drop in First Of's long position.

The idea behind Axos Financial and First of Long pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.