Correlation Between Axiologix and Airtel Africa

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

By analyzing existing cross correlation between Axiologix and Airtel Africa Plc, you can compare the effects of market volatilities on Axiologix and Airtel Africa 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 Axiologix with a short position of Airtel Africa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axiologix and Airtel Africa.

Diversification Opportunities for Axiologix and Airtel Africa

0.0

Correlation Coefficient

Axiologix  Airtel Africa

Pay attention - limited upside

The 3 months correlation between Axiologix and Airtel is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Axiologix and Airtel Africa Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airtel Africa Plc and Axiologix 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 Axiologix are associated (or correlated) with Airtel Africa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airtel Africa Plc has no effect on the direction of Axiologix i.e., Axiologix and Airtel Africa go up and down completely randomly.

Pair Corralation between Axiologix and Airtel Africa

If you would invest  124.00  in Airtel Africa Plc on October 22, 2024 and sell it today you would earn a total of  24.00  from holding Airtel Africa Plc or generate 19.35% return on investment over 90 days.

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

Axiologix  vs.  Airtel Africa Plc

Axiologix

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Axiologix has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong essential indicators, Axiologix is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Airtel Africa Plc

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Airtel Africa Plc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Airtel Africa may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Axiologix and Airtel Africa

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

The idea behind Axiologix and Airtel Africa Plc 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.

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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.