Correlation Between Ameriprise Financial and UnitedHealth Group
Can any of the company-specific risk be diversified away by investing in both Ameriprise Financial and UnitedHealth Group 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 Ameriprise Financial and UnitedHealth Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameriprise Financial and UnitedHealth Group Incorporated, you can compare the effects of market volatilities on Ameriprise Financial and UnitedHealth Group 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 Ameriprise Financial with a short position of UnitedHealth Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameriprise Financial and UnitedHealth Group.
Diversification Opportunities for Ameriprise Financial and UnitedHealth Group
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ameriprise and UnitedHealth is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Ameriprise Financial and UnitedHealth Group Incorporate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UnitedHealth Group and Ameriprise Financial 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 Ameriprise Financial are associated (or correlated) with UnitedHealth Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UnitedHealth Group has no effect on the direction of Ameriprise Financial i.e., Ameriprise Financial and UnitedHealth Group go up and down completely randomly.
Pair Corralation between Ameriprise Financial and UnitedHealth Group
Assuming the 90 days trading horizon Ameriprise Financial is expected to generate 2.2 times more return on investment than UnitedHealth Group. However, Ameriprise Financial is 2.2 times more volatile than UnitedHealth Group Incorporated. It trades about 0.22 of its potential returns per unit of risk. UnitedHealth Group Incorporated is currently generating about 0.2 per unit of risk. If you would invest 928,741 in Ameriprise Financial on August 31, 2024 and sell it today you would earn a total of 229,412 from holding Ameriprise Financial or generate 24.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ameriprise Financial vs. UnitedHealth Group Incorporate
Performance |
| Timeline |
| Ameriprise Financial |
| UnitedHealth Group |
Ameriprise Financial and UnitedHealth Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameriprise Financial and UnitedHealth Group
The main advantage of trading using opposite Ameriprise Financial and UnitedHealth Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameriprise Financial position performs unexpectedly, UnitedHealth Group 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 UnitedHealth Group will offset losses from the drop in UnitedHealth Group's long position.| Ameriprise Financial vs. First Majestic Silver | Ameriprise Financial vs. FibraHotel | Ameriprise Financial vs. Monster Beverage Corp | Ameriprise Financial vs. Verizon Communications |
| UnitedHealth Group vs. The Select Sector | UnitedHealth Group vs. Promotora y Operadora | UnitedHealth Group vs. SPDR Series Trust | UnitedHealth Group vs. iShares Trust |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |