Correlation Between Moelis and Axis Technologies

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

By analyzing existing cross correlation between Moelis Co and Axis Technologies Group, you can compare the effects of market volatilities on Moelis and Axis Technologies 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 Moelis with a short position of Axis Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moelis and Axis Technologies.

Diversification Opportunities for Moelis and Axis Technologies

0.15

Correlation Coefficient

Moelis  Axis Technologies

Average diversification

The 3 months correlation between Moelis and Axis is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Moelis Co and Axis Technologies Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axis Technologies and Moelis 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 Moelis Co are associated (or correlated) with Axis Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axis Technologies has no effect on the direction of Moelis i.e., Moelis and Axis Technologies go up and down completely randomly.

Pair Corralation between Moelis and Axis Technologies

Allowing for the 90-day total investment horizon Moelis Co is expected to under-perform the Axis Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Moelis Co is 19.11 times less risky than Axis Technologies. The stock trades about -0.16 of its potential returns per unit of risk. The Axis Technologies Group is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  0.04  in Axis Technologies Group on December 17, 2024 and sell it today you would earn a total of  0.00  from holding Axis Technologies Group or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

Moelis Co  vs.  Axis Technologies Group

Moelis

Risk-Adjusted Performance

Very Weak

Over the last 90 days Moelis Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Axis Technologies

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Axis Technologies Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Axis Technologies reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Moelis and Axis Technologies

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

The idea behind Moelis Co and Axis Technologies Group 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.