Correlation Between Travelers Companies and Sofina Société
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and Sofina Société 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 Sofina Société 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 Sofina Socit Anonyme, you can compare the effects of market volatilities on Travelers Companies and Sofina Société 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 Sofina Société. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and Sofina Société.
Diversification Opportunities for Travelers Companies and Sofina Société
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Travelers and Sofina is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and Sofina Socit Anonyme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sofina Socit Anonyme 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 Sofina Société. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sofina Socit Anonyme has no effect on the direction of Travelers Companies i.e., Travelers Companies and Sofina Société go up and down completely randomly.
Pair Corralation between Travelers Companies and Sofina Société
Considering the 90-day investment horizon The Travelers Companies is expected to generate 11.25 times more return on investment than Sofina Société. However, Travelers Companies is 11.25 times more volatile than Sofina Socit Anonyme. It trades about 0.33 of its potential returns per unit of risk. Sofina Socit Anonyme is currently generating about -0.22 per unit of risk. If you would invest 24,564 in The Travelers Companies on September 2, 2024 and sell it today you would earn a total of 2,040 from holding The Travelers Companies or generate 8.3% 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. Sofina Socit Anonyme
Performance |
| Timeline |
| The Travelers Companies |
| Sofina Socit Anonyme |
Travelers Companies and Sofina Société Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and Sofina Société
The main advantage of trading using opposite Travelers Companies and Sofina Société positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, Sofina Société 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 Sofina Société will offset losses from the drop in Sofina Société'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 |
| Sofina Société vs. Marygold Companies | Sofina Société vs. Carbon Streaming Corp | Sofina Société vs. Arrowmark Financial Corp | Sofina Société vs. Patria Investments |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |