Correlation Between Corporate Travel and MetLife
Can any of the company-specific risk be diversified away by investing in both Corporate Travel and MetLife 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 Corporate Travel and MetLife into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corporate Travel Management and MetLife, you can compare the effects of market volatilities on Corporate Travel and MetLife 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 Corporate Travel with a short position of MetLife. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporate Travel and MetLife.
Diversification Opportunities for Corporate Travel and MetLife
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Corporate and MetLife is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Corporate Travel Management and MetLife in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetLife and Corporate Travel 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 Corporate Travel Management are associated (or correlated) with MetLife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetLife has no effect on the direction of Corporate Travel i.e., Corporate Travel and MetLife go up and down completely randomly.
Pair Corralation between Corporate Travel and MetLife
Assuming the 90 days trading horizon Corporate Travel Management is expected to generate 1.18 times more return on investment than MetLife. However, Corporate Travel is 1.18 times more volatile than MetLife. It trades about 0.24 of its potential returns per unit of risk. MetLife is currently generating about 0.01 per unit of risk. If you would invest 750.00 in Corporate Travel Management on September 13, 2024 and sell it today you would earn a total of 70.00 from holding Corporate Travel Management or generate 9.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Corporate Travel Management vs. MetLife
Performance |
| Timeline |
| Corporate Travel Man |
| MetLife |
Corporate Travel and MetLife Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Corporate Travel and MetLife
The main advantage of trading using opposite Corporate Travel and MetLife positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corporate Travel position performs unexpectedly, MetLife 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 MetLife will offset losses from the drop in MetLife's long position.| Corporate Travel vs. Apple Inc | Corporate Travel vs. Apple Inc | Corporate Travel vs. Apple Inc | Corporate Travel vs. Apple Inc |
| MetLife vs. Tradeweb Markets | MetLife vs. CarsalesCom | MetLife vs. NXP Semiconductors NV | MetLife vs. CANON MARKETING JP |
Check out your portfolio center.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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |