Correlation Between Travelers Companies and Admiral Group
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and Admiral Group 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 Travelers Companies and Admiral Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Travelers Companies and Admiral Group plc, you can compare the effects of market volatilities on Travelers Companies and Admiral Group 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 Travelers Companies with a short position of Admiral Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and Admiral Group.
Diversification Opportunities for Travelers Companies and Admiral Group
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Travelers and Admiral is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and Admiral Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Admiral Group plc and Travelers Companies 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 The Travelers Companies are associated (or correlated) with Admiral Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Admiral Group plc has no effect on the direction of Travelers Companies i.e., Travelers Companies and Admiral Group go up and down completely randomly.
Pair Corralation between Travelers Companies and Admiral Group
Considering the 90-day investment horizon The Travelers Companies is expected to generate 0.78 times more return on investment than Admiral Group. However, The Travelers Companies is 1.28 times less risky than Admiral Group. It trades about 0.32 of its potential returns per unit of risk. Admiral Group plc is currently generating about -0.26 per unit of risk. If you would invest 24,594 in The Travelers Companies on September 1, 2024 and sell it today you would earn a total of 2,010 from holding The Travelers Companies or generate 8.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Travelers Companies vs. Admiral Group plc
Performance |
| Timeline |
| The Travelers Companies |
| Admiral Group plc |
Travelers Companies and Admiral Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and Admiral Group
The main advantage of trading using opposite Travelers Companies and Admiral Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, Admiral Group 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 Admiral Group will offset losses from the drop in Admiral Group's long position.| Travelers Companies vs. Selective Insurance Group | Travelers Companies vs. Aquagold International | Travelers Companies vs. Thrivent High Yield | Travelers Companies vs. Morningstar Unconstrained Allocation |
| Admiral Group vs. Aspen Insurance Holdings | Admiral Group vs. AmTrust Financial Services | Admiral Group vs. AmTrust Financial Services | Admiral Group vs. AmTrust Financial Services |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |