Correlation Between TRAVELERS and JBG SMITH

Can any of the company-specific risk be diversified away by investing in both TRAVELERS and JBG SMITH 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 and JBG SMITH into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TRAVELERS INC 4 and JBG SMITH Properties, you can compare the effects of market volatilities on TRAVELERS and JBG SMITH 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 with a short position of JBG SMITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRAVELERS and JBG SMITH.

Diversification Opportunities for TRAVELERS and JBG SMITH

0.14

Correlation Coefficient

TRAVELERS  JBG SMITH

Average diversification

The 3 months correlation between TRAVELERS and JBG is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding TRAVELERS INC 4 and JBG SMITH Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JBG SMITH Properties and TRAVELERS 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 TRAVELERS INC 4 are associated (or correlated) with JBG SMITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JBG SMITH Properties has no effect on the direction of TRAVELERS i.e., TRAVELERS and JBG SMITH go up and down completely randomly.

Pair Corralation between TRAVELERS and JBG SMITH

Assuming the 90 days trading horizon TRAVELERS INC 4 is expected to under-perform the JBG SMITH. But the bond apears to be less risky and, when comparing its historical volatility, TRAVELERS INC 4 is 1.48 times less risky than JBG SMITH. The bond trades about 0.0 of its potential returns per unit of risk. The JBG SMITH Properties is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  1,516  in JBG SMITH Properties on December 30, 2024 and sell it today you would earn a total of  76.00  from holding JBG SMITH Properties or generate 5.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	74.19%
Values	Daily Returns

TRAVELERS INC 4  vs.  JBG SMITH Properties

TRAVELERS INC 4

Risk-Adjusted Performance

Very Weak

Over the last 90 days TRAVELERS INC 4 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, TRAVELERS is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

JBG SMITH Properties

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in JBG SMITH Properties are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent technical and fundamental indicators, JBG SMITH may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with TRAVELERS and JBG SMITH

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

The idea behind TRAVELERS INC 4 and JBG SMITH Properties 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.