Correlation Between PHILIP and Travelers Companies
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By analyzing existing cross correlation between PHILIP MORRIS INTL and The Travelers Companies, you can compare the effects of market volatilities on PHILIP 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 PHILIP with a short position of Travelers Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of PHILIP and Travelers Companies.
Diversification Opportunities for PHILIP and Travelers Companies
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PHILIP and Travelers is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding PHILIP MORRIS INTL 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 PHILIP 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 PHILIP MORRIS INTL 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 PHILIP i.e., PHILIP and Travelers Companies go up and down completely randomly.
Pair Corralation between PHILIP and Travelers Companies
Assuming the 90 days trading horizon PHILIP MORRIS INTL is expected to under-perform the Travelers Companies. In addition to that, PHILIP is 1.64 times more volatile than The Travelers Companies. It trades about -0.11 of its total potential returns per unit of risk. The Travelers Companies is currently generating about 0.28 per unit of volatility. If you would invest 24,281 in The Travelers Companies on September 5, 2024 and sell it today you would earn a total of 1,778 from holding The Travelers Companies or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
PHILIP MORRIS INTL vs. The Travelers Companies
Performance |
| Timeline |
| PHILIP MORRIS INTL |
| The Travelers Companies |
PHILIP and Travelers Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PHILIP and Travelers Companies
The main advantage of trading using opposite PHILIP and Travelers Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PHILIP 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.| PHILIP vs. Highway Holdings Limited | PHILIP vs. Postal Realty Trust | PHILIP vs. Harmony Gold Mining | PHILIP vs. Solstad Offshore ASA |
| Travelers Companies vs. Progressive Corp | Travelers Companies vs. Chubb | Travelers Companies vs. Cincinnati Financial | Travelers Companies vs. W R Berkley |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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