Correlation Between Travelers Companies and Bolloré SE
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and Bolloré SE 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 Bolloré SE 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 Bollor SE, you can compare the effects of market volatilities on Travelers Companies and Bolloré SE 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 Bolloré SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and Bolloré SE.
Diversification Opportunities for Travelers Companies and Bolloré SE
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Travelers and Bolloré is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and Bollor SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bolloré SE 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 Bolloré SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bolloré SE has no effect on the direction of Travelers Companies i.e., Travelers Companies and Bolloré SE go up and down completely randomly.
Pair Corralation between Travelers Companies and Bolloré SE
Considering the 90-day investment horizon The Travelers Companies is expected to generate 0.9 times more return on investment than Bolloré SE. However, The Travelers Companies is 1.11 times less risky than Bolloré SE. It trades about 0.15 of its potential returns per unit of risk. Bollor SE is currently generating about -0.01 per unit of risk. If you would invest 22,688 in The Travelers Companies on September 2, 2024 and sell it today you would earn a total of 3,916 from holding The Travelers Companies or generate 17.26% 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. Bollor SE
Performance |
| Timeline |
| The Travelers Companies |
| Bolloré SE |
Travelers Companies and Bolloré SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and Bolloré SE
The main advantage of trading using opposite Travelers Companies and Bolloré SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, Bolloré SE 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 Bolloré SE will offset losses from the drop in Bolloré SE'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 |
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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.
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