Correlation Between Travelers Companies and Timothy Plan
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and Timothy Plan 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 Timothy Plan 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 Timothy Plan LargeMid, you can compare the effects of market volatilities on Travelers Companies and Timothy Plan 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 Timothy Plan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and Timothy Plan.
Diversification Opportunities for Travelers Companies and Timothy Plan
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Travelers and Timothy is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and Timothy Plan LargeMid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Timothy Plan LargeMid 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 Timothy Plan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Timothy Plan LargeMid has no effect on the direction of Travelers Companies i.e., Travelers Companies and Timothy Plan go up and down completely randomly.
Pair Corralation between Travelers Companies and Timothy Plan
Considering the 90-day investment horizon The Travelers Companies is expected to generate 1.74 times more return on investment than Timothy Plan. However, Travelers Companies is 1.74 times more volatile than Timothy Plan LargeMid. It trades about 0.07 of its potential returns per unit of risk. Timothy Plan LargeMid is currently generating about 0.08 per unit of risk. If you would invest 17,932 in The Travelers Companies on August 27, 2024 and sell it today you would earn a total of 8,315 from holding The Travelers Companies or generate 46.37% 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. Timothy Plan LargeMid
Performance |
| Timeline |
| The Travelers Companies |
| Timothy Plan LargeMid |
Travelers Companies and Timothy Plan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and Timothy Plan
The main advantage of trading using opposite Travelers Companies and Timothy Plan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, Timothy Plan 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 Timothy Plan will offset losses from the drop in Timothy Plan's long position.| Travelers Companies vs. Fiverr International | Travelers Companies vs. Pinterest | Travelers Companies vs. Upstart Holdings | Travelers Companies vs. Fastly Inc |
| Timothy Plan vs. Timothy Plan High | Timothy Plan vs. Timothy Plan Small | Timothy Plan vs. Timothy Plan International | Timothy Plan vs. Timothy Plan |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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