Correlation Between Axonic Strategic and Simplify Exchange

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

By analyzing existing cross correlation between Axonic Strategic Income and Simplify Exchange Traded, you can compare the effects of market volatilities on Axonic Strategic and Simplify Exchange 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 Axonic Strategic with a short position of Simplify Exchange. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axonic Strategic and Simplify Exchange.

Diversification Opportunities for Axonic Strategic and Simplify Exchange

-0.36

Correlation Coefficient

Axonic Strategic  Simplify Exchange

Very good diversification

The 3 months correlation between Axonic and Simplify is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Axonic Strategic Income and Simplify Exchange Traded in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simplify Exchange Traded and Axonic Strategic 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 Axonic Strategic Income are associated (or correlated) with Simplify Exchange. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simplify Exchange Traded has no effect on the direction of Axonic Strategic i.e., Axonic Strategic and Simplify Exchange go up and down completely randomly.

Pair Corralation between Axonic Strategic and Simplify Exchange

Assuming the 90 days horizon Axonic Strategic Income is expected to generate 0.3 times more return on investment than Simplify Exchange. However, Axonic Strategic Income is 3.33 times less risky than Simplify Exchange. It trades about 0.12 of its potential returns per unit of risk. Simplify Exchange Traded is currently generating about -0.15 per unit of risk. If you would invest  870.00  in Axonic Strategic Income on May 1, 2025 and sell it today you would earn a total of  9.00  from holding Axonic Strategic Income or generate 1.03% return on investment over 90 days.

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

Axonic Strategic Income  vs.  Simplify Exchange Traded

Axonic Strategic Income

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Axonic Strategic Income are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Axonic Strategic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Simplify Exchange Traded

Risk-Adjusted Performance

Very Weak

Over the last 90 days Simplify Exchange Traded has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Simplify Exchange is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Axonic Strategic and Simplify Exchange

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

The idea behind Axonic Strategic Income and Simplify Exchange Traded 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.