Correlation Between Travelers Companies and NEXTERA
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By analyzing existing cross correlation between The Travelers Companies and NEXTERA ENERGY CAPITAL, you can compare the effects of market volatilities on Travelers Companies and NEXTERA 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 NEXTERA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and NEXTERA.
Diversification Opportunities for Travelers Companies and NEXTERA
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Travelers and NEXTERA is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and NEXTERA ENERGY CAPITAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXTERA ENERGY CAPITAL 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 NEXTERA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXTERA ENERGY CAPITAL has no effect on the direction of Travelers Companies i.e., Travelers Companies and NEXTERA go up and down completely randomly.
Pair Corralation between Travelers Companies and NEXTERA
Considering the 90-day investment horizon The Travelers Companies is expected to generate 1.48 times more return on investment than NEXTERA. However, Travelers Companies is 1.48 times more volatile than NEXTERA ENERGY CAPITAL. It trades about 0.24 of its potential returns per unit of risk. NEXTERA ENERGY CAPITAL is currently generating about -0.26 per unit of risk. If you would invest 25,009 in The Travelers Companies on August 31, 2024 and sell it today you would earn a total of 1,657 from holding The Travelers Companies or generate 6.63% 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. NEXTERA ENERGY CAPITAL
Performance |
| Timeline |
| The Travelers Companies |
| NEXTERA ENERGY CAPITAL |
Travelers Companies and NEXTERA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and NEXTERA
The main advantage of trading using opposite Travelers Companies and NEXTERA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, NEXTERA 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 NEXTERA will offset losses from the drop in NEXTERA's long position.| Travelers Companies vs. Progressive Corp | Travelers Companies vs. Chubb | Travelers Companies vs. The Allstate | Travelers Companies vs. Selective Insurance Group |
| NEXTERA vs. enVVeno Medical Corp | NEXTERA vs. Bassett Furniture Industries | NEXTERA vs. Mid Atlantic Home Health | NEXTERA vs. Smith Douglas Homes |
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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