Correlation Between Travelers Companies and PATTERSON
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By analyzing existing cross correlation between The Travelers Companies and PATTERSON UTI ENERGY INC, you can compare the effects of market volatilities on Travelers Companies and PATTERSON 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 PATTERSON. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and PATTERSON.
Diversification Opportunities for Travelers Companies and PATTERSON
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Travelers and PATTERSON is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and PATTERSON UTI ENERGY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PATTERSON UTI ENERGY 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 PATTERSON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PATTERSON UTI ENERGY has no effect on the direction of Travelers Companies i.e., Travelers Companies and PATTERSON go up and down completely randomly.
Pair Corralation between Travelers Companies and PATTERSON
Considering the 90-day investment horizon The Travelers Companies is expected to generate 0.58 times more return on investment than PATTERSON. However, The Travelers Companies is 1.72 times less risky than PATTERSON. It trades about -0.15 of its potential returns per unit of risk. PATTERSON UTI ENERGY INC is currently generating about -0.23 per unit of risk. If you would invest 25,728 in The Travelers Companies on September 12, 2024 and sell it today you would lose (963.00) from holding The Travelers Companies or give up 3.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
The Travelers Companies vs. PATTERSON UTI ENERGY INC
Performance |
| Timeline |
| The Travelers Companies |
| PATTERSON UTI ENERGY |
Travelers Companies and PATTERSON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and PATTERSON
The main advantage of trading using opposite Travelers Companies and PATTERSON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, PATTERSON 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 PATTERSON will offset losses from the drop in PATTERSON's long position.| Travelers Companies vs. Aeye Inc | Travelers Companies vs. Ep Emerging Markets | Travelers Companies vs. LiCycle Holdings Corp | Travelers Companies vs. SEI Investments |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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