Correlation Between Clean and Travelers Companies
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By analyzing existing cross correlation between Clean Harbors 5125 and The Travelers Companies, you can compare the effects of market volatilities on Clean 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 Clean with a short position of Travelers Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clean and Travelers Companies.
Diversification Opportunities for Clean and Travelers Companies
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Clean and Travelers is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Clean Harbors 5125 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 Clean 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 Clean Harbors 5125 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 Clean i.e., Clean and Travelers Companies go up and down completely randomly.
Pair Corralation between Clean and Travelers Companies
Assuming the 90 days trading horizon Clean Harbors 5125 is expected to under-perform the Travelers Companies. But the bond apears to be less risky and, when comparing its historical volatility, Clean Harbors 5125 is 1.05 times less risky than Travelers Companies. The bond trades about -0.23 of its potential returns per unit of risk. The The Travelers Companies is currently generating about -0.15 of returns per unit of risk over similar time horizon. 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 | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Clean Harbors 5125 vs. The Travelers Companies
Performance |
| Timeline |
| Clean Harbors 5125 |
| The Travelers Companies |
Clean and Travelers Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clean and Travelers Companies
The main advantage of trading using opposite Clean and Travelers Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clean 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.The idea behind Clean Harbors 5125 and The Travelers Companies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Travelers Companies vs. Aeye Inc | Travelers Companies vs. Ep Emerging Markets | Travelers Companies vs. LiCycle Holdings Corp | Travelers Companies vs. SEI Investments |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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