Correlation Between Travelers Companies and NEOS ETF
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and NEOS 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 NEOS 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 NEOS ETF Trust, you can compare the effects of market volatilities on Travelers Companies and NEOS 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 NEOS ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and NEOS ETF.
Diversification Opportunities for Travelers Companies and NEOS ETF
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Travelers and NEOS is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and NEOS ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEOS 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 NEOS ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEOS ETF Trust has no effect on the direction of Travelers Companies i.e., Travelers Companies and NEOS ETF go up and down completely randomly.
Pair Corralation between Travelers Companies and NEOS ETF
Considering the 90-day investment horizon The Travelers Companies is expected to generate 1.48 times more return on investment than NEOS ETF. However, Travelers Companies is 1.48 times more volatile than NEOS ETF Trust. It trades about 0.26 of its potential returns per unit of risk. NEOS ETF Trust is currently generating about 0.07 per unit of risk. If you would invest 24,867 in The Travelers Companies on August 30, 2024 and sell it today you would earn a total of 1,799 from holding The Travelers Companies or generate 7.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Travelers Companies vs. NEOS ETF Trust
Performance |
| Timeline |
| The Travelers Companies |
| NEOS ETF Trust |
Travelers Companies and NEOS ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and NEOS ETF
The main advantage of trading using opposite Travelers Companies and NEOS ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, NEOS 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 NEOS ETF will offset losses from the drop in NEOS ETF's long position.| Travelers Companies vs. Axa Equitable Holdings | Travelers Companies vs. American International Group | Travelers Companies vs. Arch Capital Group | Travelers Companies vs. Sun Life Financial |
| NEOS ETF vs. Global X Russell | NEOS ETF vs. Global X SP | NEOS ETF vs. Global X NASDAQ | NEOS ETF vs. Amplify CWP Enhanced |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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