Correlation Between MetLife and Taya Inv
Can any of the company-specific risk be diversified away by investing in both MetLife and Taya Inv 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 MetLife and Taya Inv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MetLife and Taya Inv L, you can compare the effects of market volatilities on MetLife and Taya Inv 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 MetLife with a short position of Taya Inv. Check out your portfolio center. Please also check ongoing floating volatility patterns of MetLife and Taya Inv.
Diversification Opportunities for MetLife and Taya Inv
Significant diversification
The 3 months correlation between MetLife and Taya is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding MetLife and Taya Inv L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taya Inv L and MetLife 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 MetLife are associated (or correlated) with Taya Inv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taya Inv L has no effect on the direction of MetLife i.e., MetLife and Taya Inv go up and down completely randomly.
Pair Corralation between MetLife and Taya Inv
Considering the 90-day investment horizon MetLife is expected to under-perform the Taya Inv. But the stock apears to be less risky and, when comparing its historical volatility, MetLife is 4.32 times less risky than Taya Inv. The stock trades about -0.27 of its potential returns per unit of risk. The Taya Inv L is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 497,200 in Taya Inv L on January 20, 2024 and sell it today you would earn a total of 6,600 from holding Taya Inv L or generate 1.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
MetLife vs. Taya Inv L
Performance |
| Timeline |
| MetLife |
| Taya Inv L |
MetLife and Taya Inv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MetLife and Taya Inv
The main advantage of trading using opposite MetLife and Taya Inv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MetLife position performs unexpectedly, Taya Inv 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 Taya Inv will offset losses from the drop in Taya Inv's long position.| MetLife vs. Lincoln National | MetLife vs. Aflac Incorporated | MetLife vs. Unum Group | MetLife vs. Manulife Financial Corp |
| Taya Inv vs. EN Shoham Business | Taya Inv vs. Accel Solutions Group | Taya Inv vs. SR Accord | Taya Inv vs. Rapac Communication Infrastructure |
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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