Correlation Between American and Travelers Companies
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By analyzing existing cross correlation between American Axle Manufacturing and The Travelers Companies, you can compare the effects of market volatilities on American and Travelers Companies 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 American with a short position of Travelers Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of American and Travelers Companies.
Diversification Opportunities for American and Travelers Companies
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Travelers is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding American Axle Manufacturing and The Travelers Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Travelers Companies and American 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 American Axle Manufacturing are associated (or correlated) with Travelers Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Travelers Companies has no effect on the direction of American i.e., American and Travelers Companies go up and down completely randomly.
Pair Corralation between American and Travelers Companies
Assuming the 90 days trading horizon American Axle Manufacturing is expected to under-perform the Travelers Companies. But the bond apears to be less risky and, when comparing its historical volatility, American Axle Manufacturing is 1.72 times less risky than Travelers Companies. The bond trades about -0.01 of its potential returns per unit of risk. The The Travelers Companies is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 17,984 in The Travelers Companies on September 4, 2024 and sell it today you would earn a total of 8,075 from holding The Travelers Companies or generate 44.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.98% |
| Values | Daily Returns |
American Axle Manufacturing vs. The Travelers Companies
Performance |
| Timeline |
| American Axle Manufa |
| The Travelers Companies |
American and Travelers Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American and Travelers Companies
The main advantage of trading using opposite American and Travelers Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American position performs unexpectedly, Travelers Companies 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 Travelers Companies will offset losses from the drop in Travelers Companies' long position.| American vs. Academy Sports Outdoors | American vs. Barrick Gold Corp | American vs. Lipocine | American vs. United Parks Resorts |
| Travelers Companies vs. Progressive Corp | Travelers Companies vs. Cincinnati Financial | Travelers Companies vs. W R Berkley | Travelers Companies vs. The Allstate |
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 CEOs Directory module to screen CEOs from public companies around the world.
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