Correlation Between AXA SA and Aya Gold

Can any of the company-specific risk be diversified away by investing in both AXA SA and Aya Gold 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 SA and Aya Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AXA SA and Aya Gold Silver, you can compare the effects of market volatilities on AXA SA and Aya Gold 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 SA with a short position of Aya Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of AXA SA and Aya Gold.

Diversification Opportunities for AXA SA and Aya Gold

-0.21

Correlation Coefficient

AXA SA  Aya Gold

Very good diversification

The 3 months correlation between AXA and Aya is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding AXA SA and Aya Gold Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aya Gold Silver and AXA SA 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 SA are associated (or correlated) with Aya Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aya Gold Silver has no effect on the direction of AXA SA i.e., AXA SA and Aya Gold go up and down completely randomly.

Pair Corralation between AXA SA and Aya Gold

Assuming the 90 days trading horizon AXA SA is expected to generate 0.29 times more return on investment than Aya Gold. However, AXA SA is 3.47 times less risky than Aya Gold. It trades about 0.25 of its potential returns per unit of risk. Aya Gold Silver is currently generating about 0.01 per unit of risk. If you would invest  3,372  in AXA SA on December 19, 2024 and sell it today you would earn a total of  613.00  from holding AXA SA or generate 18.18% return on investment over 90 days.

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

AXA SA  vs.  Aya Gold Silver

AXA SA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in AXA SA are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite somewhat fragile basic indicators, AXA SA sustained solid returns over the last few months and may actually be approaching a breakup point.

Aya Gold Silver

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Aya Gold Silver are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, Aya Gold is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with AXA SA and Aya Gold

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

The idea behind AXA SA and Aya Gold Silver 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.