Correlation Between Travelers Companies and Innovator Etfs
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and Innovator Etfs 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 Innovator Etfs 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 Innovator Etfs Trust, you can compare the effects of market volatilities on Travelers Companies and Innovator Etfs 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 Innovator Etfs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and Innovator Etfs.
Diversification Opportunities for Travelers Companies and Innovator Etfs
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Travelers and Innovator is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and Innovator Etfs Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovator Etfs Trust 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 Innovator Etfs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovator Etfs Trust has no effect on the direction of Travelers Companies i.e., Travelers Companies and Innovator Etfs go up and down completely randomly.
Pair Corralation between Travelers Companies and Innovator Etfs
Considering the 90-day investment horizon The Travelers Companies is expected to under-perform the Innovator Etfs. In addition to that, Travelers Companies is 10.11 times more volatile than Innovator Etfs Trust. It trades about -0.02 of its total potential returns per unit of risk. Innovator Etfs Trust is currently generating about 0.24 per unit of volatility. If you would invest 2,435 in Innovator Etfs Trust on October 26, 2024 and sell it today you would earn a total of 47.00 from holding Innovator Etfs Trust or generate 1.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Travelers Companies vs. Innovator Etfs Trust
Performance |
| Timeline |
| The Travelers Companies |
| Innovator Etfs Trust |
Travelers Companies and Innovator Etfs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and Innovator Etfs
The main advantage of trading using opposite Travelers Companies and Innovator Etfs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, Innovator Etfs 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 Innovator Etfs will offset losses from the drop in Innovator Etfs' long position.| Travelers Companies vs. Progressive Corp | Travelers Companies vs. Chubb | Travelers Companies vs. Cincinnati Financial | Travelers Companies vs. W R Berkley |
| Innovator Etfs vs. Innovator Premium Income | Innovator Etfs vs. Innovator Premium Income | Innovator Etfs vs. Innovator Premium Income |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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