Correlation Between Assicurazioni Generali and Axa Equitable

Can any of the company-specific risk be diversified away by investing in both Assicurazioni Generali 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 Assicurazioni Generali and Axa Equitable into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Assicurazioni Generali SpA and Axa Equitable Holdings, you can compare the effects of market volatilities on Assicurazioni Generali 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 Assicurazioni Generali with a short position of Axa Equitable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Assicurazioni Generali and Axa Equitable.

Diversification Opportunities for Assicurazioni Generali and Axa Equitable

0.64

Correlation Coefficient

Assicurazioni Generali  Axa Equitable

Poor diversification

The 3 months correlation between Assicurazioni and Axa is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Assicurazioni Generali SpA 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 Assicurazioni Generali 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 Assicurazioni Generali SpA 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 Assicurazioni Generali i.e., Assicurazioni Generali and Axa Equitable go up and down completely randomly.

Pair Corralation between Assicurazioni Generali and Axa Equitable

Assuming the 90 days horizon Assicurazioni Generali SpA is expected to generate 0.7 times more return on investment than Axa Equitable. However, Assicurazioni Generali SpA is 1.43 times less risky than Axa Equitable. It trades about 0.15 of its potential returns per unit of risk. Axa Equitable Holdings is currently generating about 0.09 per unit of risk. If you would invest  2,905  in Assicurazioni Generali SpA on December 30, 2024 and sell it today you would earn a total of  375.00  from holding Assicurazioni Generali SpA or generate 12.91% return on investment over 90 days.

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

Assicurazioni Generali SpA  vs.  Axa Equitable Holdings

Assicurazioni Generali

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Assicurazioni Generali SpA are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Assicurazioni Generali reported solid returns over the last few months and may actually be approaching a breakup point.

Axa Equitable Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Axa Equitable Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile basic indicators, Axa Equitable may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Assicurazioni Generali and Axa Equitable

The main advantage of trading using opposite Assicurazioni Generali and Axa Equitable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Assicurazioni Generali 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.

The idea behind Assicurazioni Generali SpA and Axa Equitable Holdings 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.