Correlation Between Burlington Stores, and UnitedHealth Group
Can any of the company-specific risk be diversified away by investing in both Burlington Stores, 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 Burlington Stores, and UnitedHealth Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burlington Stores, and UnitedHealth Group Incorporated, you can compare the effects of market volatilities on Burlington Stores, 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 Burlington Stores, with a short position of UnitedHealth Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burlington Stores, and UnitedHealth Group.
Diversification Opportunities for Burlington Stores, and UnitedHealth Group
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Burlington and UnitedHealth is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Burlington Stores, and UnitedHealth Group Incorporate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UnitedHealth Group and Burlington Stores, 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 Burlington Stores, 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 Burlington Stores, i.e., Burlington Stores, and UnitedHealth Group go up and down completely randomly.
Pair Corralation between Burlington Stores, and UnitedHealth Group
Assuming the 90 days trading horizon Burlington Stores, is expected to generate 2.27 times more return on investment than UnitedHealth Group. However, Burlington Stores, is 2.27 times more volatile than UnitedHealth Group Incorporated. It trades about 0.04 of its potential returns per unit of risk. UnitedHealth Group Incorporated is currently generating about 0.04 per unit of risk. If you would invest 4,000 in Burlington Stores, on October 14, 2024 and sell it today you would earn a total of 1,926 from holding Burlington Stores, or generate 48.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 84.34% |
| Values | Daily Returns |
Burlington Stores, vs. UnitedHealth Group Incorporate
Performance |
| Timeline |
| Burlington Stores, |
| UnitedHealth Group |
Burlington Stores, and UnitedHealth Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burlington Stores, and UnitedHealth Group
The main advantage of trading using opposite Burlington Stores, and UnitedHealth Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burlington Stores, 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.| Burlington Stores, vs. Taiwan Semiconductor Manufacturing | Burlington Stores, vs. Apple Inc | Burlington Stores, vs. Alibaba Group Holding | Burlington Stores, vs. Banco Santander Chile |
| UnitedHealth Group vs. Capital One Financial | UnitedHealth Group vs. Burlington Stores, | UnitedHealth Group vs. Prudential Financial | UnitedHealth Group vs. Broadridge Financial Solutions, |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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