Correlation Between Fundamental Global and Axa Equitable

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

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

Diversification Opportunities for Fundamental Global and Axa Equitable

-0.03

Correlation Coefficient

Fundamental Global  Axa Equitable

Good diversification

The 3 months correlation between Fundamental and Axa is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Fundamental Global 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 Fundamental Global 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 Fundamental Global 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 Fundamental Global i.e., Fundamental Global and Axa Equitable go up and down completely randomly.

Pair Corralation between Fundamental Global and Axa Equitable

Considering the 90-day investment horizon Fundamental Global is expected to generate 4.58 times less return on investment than Axa Equitable. In addition to that, Fundamental Global is 2.69 times more volatile than Axa Equitable Holdings. It trades about 0.01 of its total potential returns per unit of risk. Axa Equitable Holdings is currently generating about 0.09 per unit of volatility. If you would invest  4,679  in Axa Equitable Holdings on December 29, 2024 and sell it today you would earn a total of  487.00  from holding Axa Equitable Holdings or generate 10.41% return on investment over 90 days.

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

Fundamental Global  vs.  Axa Equitable Holdings

Fundamental Global

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fundamental Global has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Fundamental Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

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 Fundamental Global and Axa Equitable

The main advantage of trading using opposite Fundamental Global and Axa Equitable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fundamental Global 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 Fundamental Global 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.