Correlation Between American Balanced and HUMANA
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By analyzing existing cross correlation between American Balanced Fund and HUMANA INC, you can compare the effects of market volatilities on American Balanced 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 American Balanced with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Balanced and HUMANA.
Diversification Opportunities for American Balanced and HUMANA
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between American and HUMANA is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding American Balanced Fund and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and American Balanced 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 American Balanced Fund 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 American Balanced i.e., American Balanced and HUMANA go up and down completely randomly.
Pair Corralation between American Balanced and HUMANA
Assuming the 90 days horizon American Balanced is expected to generate 110.5 times less return on investment than HUMANA. But when comparing it to its historical volatility, American Balanced Fund is 160.74 times less risky than HUMANA. It trades about 0.11 of its potential returns per unit of risk. HUMANA INC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 7,980 in HUMANA INC on September 1, 2024 and sell it today you would lose (285.00) from holding HUMANA INC or give up 3.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.51% |
| Values | Daily Returns |
American Balanced Fund vs. HUMANA INC
Performance |
| Timeline |
| American Balanced |
| HUMANA INC |
American Balanced and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Balanced and HUMANA
The main advantage of trading using opposite American Balanced and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Balanced 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.| American Balanced vs. Income Fund Of | American Balanced vs. Capital Income Builder | American Balanced vs. Capital World Growth | American Balanced vs. Growth Fund Of |
| HUMANA vs. NI Holdings | HUMANA vs. Naked Wines plc | HUMANA vs. Kinsale Capital Group | HUMANA vs. Diageo PLC ADR |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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