Correlation Between Binance Coin and Centene Corp
Can any of the company-specific risk be diversified away by investing in both Binance Coin and Centene Corp 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 Binance Coin and Centene Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binance Coin and Centene Corp, you can compare the effects of market volatilities on Binance Coin and Centene Corp 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 Binance Coin with a short position of Centene Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binance Coin and Centene Corp.
Diversification Opportunities for Binance Coin and Centene Corp
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Binance and Centene is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Binance Coin and Centene Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centene Corp and Binance Coin 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 Binance Coin are associated (or correlated) with Centene Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centene Corp has no effect on the direction of Binance Coin i.e., Binance Coin and Centene Corp go up and down completely randomly.
Pair Corralation between Binance Coin and Centene Corp
Assuming the 90 days trading horizon Binance Coin is expected to under-perform the Centene Corp. In addition to that, Binance Coin is 1.01 times more volatile than Centene Corp. It trades about -0.17 of its total potential returns per unit of risk. Centene Corp is currently generating about 0.22 per unit of volatility. If you would invest 6,058 in Centene Corp on November 1, 2024 and sell it today you would earn a total of 404.00 from holding Centene Corp or generate 6.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Binance Coin vs. Centene Corp
Performance |
| Timeline |
| Binance Coin |
| Centene Corp |
Binance Coin and Centene Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binance Coin and Centene Corp
The main advantage of trading using opposite Binance Coin and Centene Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binance Coin position performs unexpectedly, Centene Corp 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 Centene Corp will offset losses from the drop in Centene Corp's long position.| Binance Coin vs. Staked Ether | Binance Coin vs. Cronos | Binance Coin vs. Wrapped Bitcoin | Binance Coin vs. Monero |
| Centene Corp vs. Humana Inc | Centene Corp vs. Elevance Health | Centene Corp vs. UnitedHealth Group Incorporated | Centene Corp vs. CVS Health Corp |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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