Correlation Between Axos Financial and Bank of Marin

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

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

Diversification Opportunities for Axos Financial and Bank of Marin

0.89

Correlation Coefficient

Axos Financial  Bank of Marin

Very poor diversification

The 3 months correlation between Axos and Bank is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and Bank of Marin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Marin 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 Bank of Marin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Marin has no effect on the direction of Axos Financial i.e., Axos Financial and Bank of Marin go up and down completely randomly.

Pair Corralation between Axos Financial and Bank of Marin

Allowing for the 90-day total investment horizon Axos Financial is expected to generate 1.16 times more return on investment than Bank of Marin. However, Axos Financial is 1.16 times more volatile than Bank of Marin. It trades about -0.01 of its potential returns per unit of risk. Bank of Marin is currently generating about -0.01 per unit of risk. If you would invest  6,703  in Axos Financial on January 25, 2025 and sell it today you would lose (443.00) from holding Axos Financial or give up 6.61% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	99.19%
Values	Daily Returns

Axos Financial  vs.  Bank of Marin

Axos Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Axos Financial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in May 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Bank of Marin

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Axos Financial and Bank of Marin

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

The idea behind Axos Financial and Bank of Marin 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.