Correlation Between Travelers Companies and ABBVIE
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By analyzing existing cross correlation between The Travelers Companies and ABBVIE INC 44, you can compare the effects of market volatilities on Travelers Companies and ABBVIE 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 ABBVIE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and ABBVIE.
Diversification Opportunities for Travelers Companies and ABBVIE
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Travelers and ABBVIE is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and ABBVIE INC 44 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ABBVIE INC 44 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 ABBVIE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ABBVIE INC 44 has no effect on the direction of Travelers Companies i.e., Travelers Companies and ABBVIE go up and down completely randomly.
Pair Corralation between Travelers Companies and ABBVIE
Considering the 90-day investment horizon Travelers Companies is expected to generate 64.18 times less return on investment than ABBVIE. But when comparing it to its historical volatility, The Travelers Companies is 57.09 times less risky than ABBVIE. It trades about 0.06 of its potential returns per unit of risk. ABBVIE INC 44 is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 9,317 in ABBVIE INC 44 on September 5, 2024 and sell it today you would lose (152.00) from holding ABBVIE INC 44 or give up 1.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.77% |
| Values | Daily Returns |
The Travelers Companies vs. ABBVIE INC 44
Performance |
| Timeline |
| The Travelers Companies |
| ABBVIE INC 44 |
Travelers Companies and ABBVIE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and ABBVIE
The main advantage of trading using opposite Travelers Companies and ABBVIE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, ABBVIE 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 ABBVIE will offset losses from the drop in ABBVIE's long position.| Travelers Companies vs. Progressive Corp | Travelers Companies vs. Chubb | Travelers Companies vs. Cincinnati Financial | Travelers Companies vs. W R Berkley |
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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