Correlation Between Axos Financial and FNB Corp

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

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

Diversification Opportunities for Axos Financial and FNB Corp

0.93

Correlation Coefficient

Axos Financial  FNB Corp

Almost no diversification

The 3 months correlation between Axos and FNB is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and FNB Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FNB Corp and Axos Financial 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 Axos Financial are associated (or correlated) with FNB Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FNB Corp has no effect on the direction of Axos Financial i.e., Axos Financial and FNB Corp go up and down completely randomly.

Pair Corralation between Axos Financial and FNB Corp

Allowing for the 90-day total investment horizon Axos Financial is expected to generate 0.96 times more return on investment than FNB Corp. However, Axos Financial is 1.04 times less risky than FNB Corp. It trades about 0.08 of its potential returns per unit of risk. FNB Corp is currently generating about 0.03 per unit of risk. If you would invest  6,421  in Axos Financial on March 21, 2025 and sell it today you would earn a total of  689.00  from holding Axos Financial or generate 10.73% return on investment over 90 days.

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

Axos Financial  vs.  FNB Corp

Axos Financial

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Axos Financial are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Axos Financial may actually be approaching a critical reversion point that can send shares even higher in July 2025.

FNB Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FNB Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, FNB Corp is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Axos Financial and FNB Corp

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

The idea behind Axos Financial and FNB Corp 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.