Correlation Between Travelers Companies and LuxUrban Hotels
Can any of the company-specific risk be diversified away by investing in both Travelers Companies and LuxUrban Hotels 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 LuxUrban Hotels 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 LuxUrban Hotels, you can compare the effects of market volatilities on Travelers Companies and LuxUrban Hotels 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 LuxUrban Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Travelers Companies and LuxUrban Hotels.
Diversification Opportunities for Travelers Companies and LuxUrban Hotels
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Travelers and LuxUrban is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding The Travelers Companies and LuxUrban Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LuxUrban Hotels 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 LuxUrban Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LuxUrban Hotels has no effect on the direction of Travelers Companies i.e., Travelers Companies and LuxUrban Hotels go up and down completely randomly.
Pair Corralation between Travelers Companies and LuxUrban Hotels
Considering the 90-day investment horizon Travelers Companies is expected to generate 8.83 times less return on investment than LuxUrban Hotels. But when comparing it to its historical volatility, The Travelers Companies is 29.59 times less risky than LuxUrban Hotels. It trades about 0.14 of its potential returns per unit of risk. LuxUrban Hotels is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 4.50 in LuxUrban Hotels on July 6, 2025 and sell it today you would lose (3.85) from holding LuxUrban Hotels or give up 85.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
The Travelers Companies vs. LuxUrban Hotels
Performance |
| Timeline |
| The Travelers Companies |
| LuxUrban Hotels |
Travelers Companies and LuxUrban Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Travelers Companies and LuxUrban Hotels
The main advantage of trading using opposite Travelers Companies and LuxUrban Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Travelers Companies position performs unexpectedly, LuxUrban Hotels 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 LuxUrban Hotels will offset losses from the drop in LuxUrban Hotels' long position.| Travelers Companies vs. Progressive Corp | Travelers Companies vs. Chubb | Travelers Companies vs. Cincinnati Financial | Travelers Companies vs. W R Berkley |
| LuxUrban Hotels vs. Lowes Companies | LuxUrban Hotels vs. Arhaus Inc | LuxUrban Hotels vs. Haverty Furniture Companies | LuxUrban Hotels vs. Walmart |
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 Stocks Directory module to find actively traded stocks across global markets.
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