Correlation Between Travelers Companies and Project Energy

Can any of the company-specific risk be diversified away by investing in both Travelers Companies and Project Energy at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Travelers Companies and Project Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between The Travelers Companies and Project Energy Reimagined, you can compare the effects of market volatilities on Travelers Companies and Project Energy 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 Project Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and Project Energy.

Diversification Opportunities for Travelers Companies and Project Energy

0.0

Correlation Coefficient

Travelers Companies  Project Energy

Pay attention - limited upside

The 3 months correlation between Travelers and Project is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and Project Energy Reimagined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Project Energy Reimagined 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 Project Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Project Energy Reimagined has no effect on the direction of Travelers Companies i.e., Travelers Companies and Project Energy go up and down completely randomly.

Pair Corralation between Travelers Companies and Project Energy

If you would invest  23,889  in The Travelers Companies on December 29, 2024 and sell it today you would earn a total of  2,290  from holding The Travelers Companies or generate 9.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

The Travelers Companies  vs.  Project Energy Reimagined

The Travelers Companies

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in The Travelers Companies are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Travelers Companies may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Project Energy Reimagined

Risk-Adjusted Performance

Very Weak

Over the last 90 days Project Energy Reimagined has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, Project Energy is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Travelers Companies and Project Energy

The main advantage of trading using opposite Travelers Companies and Project Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, Project Energy 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 Project Energy will offset losses from the drop in Project Energy's long position.

The idea behind The Travelers Companies and Project Energy Reimagined 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.

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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.