Correlation Between Travelers Companies and Janone
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and Janone 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 Janone 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 Janone Inc, you can compare the effects of market volatilities on Travelers Companies and Janone 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 Janone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and Janone.
Diversification Opportunities for Travelers Companies and Janone
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Travelers and Janone is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and Janone Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janone Inc 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 Janone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janone Inc has no effect on the direction of Travelers Companies i.e., Travelers Companies and Janone go up and down completely randomly.
Pair Corralation between Travelers Companies and Janone
Considering the 90-day investment horizon Travelers Companies is expected to generate 1.04 times less return on investment than Janone. But when comparing it to its historical volatility, The Travelers Companies is 6.99 times less risky than Janone. It trades about 0.06 of its potential returns per unit of risk. Janone Inc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 196.00 in Janone Inc on September 3, 2024 and sell it today you would lose (196.00) from holding Janone Inc or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 80.2% |
| Values | Daily Returns |
The Travelers Companies vs. Janone Inc
Performance |
| Timeline |
| The Travelers Companies |
| Janone Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Travelers Companies and Janone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and Janone
The main advantage of trading using opposite Travelers Companies and Janone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, Janone 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 Janone will offset losses from the drop in Janone's long position.| Travelers Companies vs. Chubb | Travelers Companies vs. SPACE | Travelers Companies vs. Ampleforth | Travelers Companies vs. ionet |
| Janone vs. Avalon Holdings | Janone vs. LanzaTech Global | Janone vs. Ambipar Emergency Response | Janone vs. Houston Natural Resources |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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