Correlation Between MetLife and Energy
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By analyzing existing cross correlation between MetLife and Energy Transfer 7125, you can compare the effects of market volatilities on MetLife and Energy 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 MetLife with a short position of Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of MetLife and Energy.
Diversification Opportunities for MetLife and Energy
Excellent diversification
The 3 months correlation between MetLife and Energy is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding MetLife and Energy Transfer 7125 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Transfer 7125 and MetLife 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 MetLife are associated (or correlated) with Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Transfer 7125 has no effect on the direction of MetLife i.e., MetLife and Energy go up and down completely randomly.
Pair Corralation between MetLife and Energy
Considering the 90-day investment horizon MetLife is expected to generate 0.71 times more return on investment than Energy. However, MetLife is 1.41 times less risky than Energy. It trades about 0.11 of its potential returns per unit of risk. Energy Transfer 7125 is currently generating about 0.02 per unit of risk. If you would invest 6,752 in MetLife on September 12, 2024 and sell it today you would earn a total of 1,422 from holding MetLife or generate 21.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MetLife vs. Energy Transfer 7125
Performance |
| Timeline |
| MetLife |
| Energy Transfer 7125 |
MetLife and Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MetLife and Energy
The main advantage of trading using opposite MetLife and Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MetLife position performs unexpectedly, Energy 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 Energy will offset losses from the drop in Energy's long position.| MetLife vs. Lincoln National | MetLife vs. Aflac Incorporated | MetLife vs. Unum Group | MetLife vs. Manulife Financial Corp |
| Energy vs. Diamond Estates Wines | Energy vs. Boston Beer | Energy vs. Ambev SA ADR | Energy vs. High Performance Beverages |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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