Correlation Between Travelers Companies and AmpliTech
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and AmpliTech 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 AmpliTech 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 AmpliTech Group, you can compare the effects of market volatilities on Travelers Companies and AmpliTech 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 AmpliTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and AmpliTech.
Diversification Opportunities for Travelers Companies and AmpliTech
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Travelers and AmpliTech is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and AmpliTech Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AmpliTech Group 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 AmpliTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AmpliTech Group has no effect on the direction of Travelers Companies i.e., Travelers Companies and AmpliTech go up and down completely randomly.
Pair Corralation between Travelers Companies and AmpliTech
Considering the 90-day investment horizon Travelers Companies is expected to generate 33.83 times less return on investment than AmpliTech. But when comparing it to its historical volatility, The Travelers Companies is 30.22 times less risky than AmpliTech. It trades about 0.13 of its potential returns per unit of risk. AmpliTech Group is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2.30 in AmpliTech Group on August 27, 2024 and sell it today you would earn a total of 0.90 from holding AmpliTech Group or generate 39.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Travelers Companies vs. AmpliTech Group
Performance |
| Timeline |
| The Travelers Companies |
| AmpliTech Group |
Travelers Companies and AmpliTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and AmpliTech
The main advantage of trading using opposite Travelers Companies and AmpliTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, AmpliTech 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 AmpliTech will offset losses from the drop in AmpliTech's long position.| Travelers Companies vs. Fiverr International | Travelers Companies vs. Pinterest | Travelers Companies vs. Upstart Holdings | Travelers Companies vs. Fastly Inc |
| AmpliTech vs. Amplitech Group | AmpliTech vs. Advent Technologies Holdings | AmpliTech vs. Cyclo Therapeutics |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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