Correlation Between Allegion PLC and HUMANA
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By analyzing existing cross correlation between Allegion PLC and HUMANA INC, you can compare the effects of market volatilities on Allegion PLC and HUMANA 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 Allegion PLC with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allegion PLC and HUMANA.
Diversification Opportunities for Allegion PLC and HUMANA
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Allegion and HUMANA is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Allegion PLC and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and Allegion PLC 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 Allegion PLC are associated (or correlated) with HUMANA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUMANA INC has no effect on the direction of Allegion PLC i.e., Allegion PLC and HUMANA go up and down completely randomly.
Pair Corralation between Allegion PLC and HUMANA
Given the investment horizon of 90 days Allegion PLC is expected to generate 99.55 times less return on investment than HUMANA. But when comparing it to its historical volatility, Allegion PLC is 64.85 times less risky than HUMANA. It trades about 0.05 of its potential returns per unit of risk. HUMANA INC is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 7,917 in HUMANA INC on August 31, 2024 and sell it today you would lose (222.00) from holding HUMANA INC or give up 2.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.06% |
| Values | Daily Returns |
Allegion PLC vs. HUMANA INC
Performance |
| Timeline |
| Allegion PLC |
| HUMANA INC |
Allegion PLC and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allegion PLC and HUMANA
The main advantage of trading using opposite Allegion PLC and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allegion PLC position performs unexpectedly, HUMANA 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 HUMANA will offset losses from the drop in HUMANA's long position.| Allegion PLC vs. MSA Safety | Allegion PLC vs. Resideo Technologies | Allegion PLC vs. NL Industries | Allegion PLC vs. Brady |
| HUMANA vs. Air Products and | HUMANA vs. GE Vernova LLC | HUMANA vs. Aris Water Solutions | HUMANA vs. Pure Cycle |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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