Correlation Between LOWES and Travelers Companies
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By analyzing existing cross correlation between LOWES PANIES INC and The Travelers Companies, you can compare the effects of market volatilities on LOWES 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 LOWES with a short position of Travelers Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of LOWES and Travelers Companies.
Diversification Opportunities for LOWES and Travelers Companies
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LOWES and Travelers is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding LOWES PANIES INC 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 LOWES 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 LOWES PANIES INC 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 LOWES i.e., LOWES and Travelers Companies go up and down completely randomly.
Pair Corralation between LOWES and Travelers Companies
Assuming the 90 days trading horizon LOWES PANIES INC is expected to generate 2.03 times more return on investment than Travelers Companies. However, LOWES is 2.03 times more volatile than The Travelers Companies. It trades about -0.03 of its potential returns per unit of risk. The Travelers Companies is currently generating about -0.15 per unit of risk. If you would invest 8,727 in LOWES PANIES INC on September 12, 2024 and sell it today you would lose (188.00) from holding LOWES PANIES INC or give up 2.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
LOWES PANIES INC vs. The Travelers Companies
Performance |
| Timeline |
| LOWES PANIES INC |
| The Travelers Companies |
LOWES and Travelers Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LOWES and Travelers Companies
The main advantage of trading using opposite LOWES and Travelers Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LOWES 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.| LOWES vs. Relx PLC ADR | LOWES vs. Bright Scholar Education | LOWES vs. Xponential Fitness | LOWES vs. Daily Journal Corp |
| 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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