Correlation Between Axos Financial and KeyCorp

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

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

Diversification Opportunities for Axos Financial and KeyCorp

0.97

Correlation Coefficient

Axos Financial  KeyCorp

Almost no diversification

The 3 months correlation between Axos and KeyCorp is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Axos Financial and KeyCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KeyCorp 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 KeyCorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KeyCorp has no effect on the direction of Axos Financial i.e., Axos Financial and KeyCorp go up and down completely randomly.

Pair Corralation between Axos Financial and KeyCorp

Allowing for the 90-day total investment horizon Axos Financial is expected to generate 1.12 times more return on investment than KeyCorp. However, Axos Financial is 1.12 times more volatile than KeyCorp. It trades about 0.2 of its potential returns per unit of risk. KeyCorp is currently generating about 0.14 per unit of risk. If you would invest  6,902  in Axos Financial on May 8, 2025 and sell it today you would earn a total of  1,605  from holding Axos Financial or generate 23.25% 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.  KeyCorp

Axos Financial

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Axos Financial are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Axos Financial showed solid returns over the last few months and may actually be approaching a breakup point.

KeyCorp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in KeyCorp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating technical and fundamental indicators, KeyCorp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Axos Financial and KeyCorp

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

The idea behind Axos Financial and KeyCorp 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 Commodity Directory module to find actively traded commodities issued by global exchanges.