Correlation Between Travelers Companies and DBX ETF
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and DBX ETF 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 DBX ETF 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 DBX ETF Trust, you can compare the effects of market volatilities on Travelers Companies and DBX ETF 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 DBX ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and DBX ETF.
Diversification Opportunities for Travelers Companies and DBX ETF
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Travelers and DBX is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and DBX ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBX ETF 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 DBX ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBX ETF Trust has no effect on the direction of Travelers Companies i.e., Travelers Companies and DBX ETF go up and down completely randomly.
Pair Corralation between Travelers Companies and DBX ETF
If you would invest 24,281 in The Travelers Companies on September 5, 2024 and sell it today you would earn a total of 1,778 from holding The Travelers Companies or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 9.09% |
| Values | Daily Returns |
The Travelers Companies vs. DBX ETF Trust
Performance |
| Timeline |
| The Travelers Companies |
| DBX ETF Trust |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Travelers Companies and DBX ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and DBX ETF
The main advantage of trading using opposite Travelers Companies and DBX ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, DBX ETF 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 DBX ETF will offset losses from the drop in DBX ETF's long position.| Travelers Companies vs. Progressive Corp | Travelers Companies vs. Chubb | Travelers Companies vs. Cincinnati Financial | Travelers Companies vs. W R Berkley |
| DBX ETF vs. Xtrackers MSCI EAFE | DBX ETF vs. SPDR MSCI Emerging | DBX ETF vs. NuShares ETF Trust | DBX ETF vs. Xtrackers MSCI USA |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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