Correlation Between Cigna Corp and Renalytix
Can any of the company-specific risk be diversified away by investing in both Cigna Corp and Renalytix 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 Cigna Corp and Renalytix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cigna Corp and Renalytix AI, you can compare the effects of market volatilities on Cigna Corp and Renalytix 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 Cigna Corp with a short position of Renalytix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cigna Corp and Renalytix.
Diversification Opportunities for Cigna Corp and Renalytix
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cigna and Renalytix is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Cigna Corp and Renalytix AI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Renalytix AI and Cigna Corp 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 Cigna Corp are associated (or correlated) with Renalytix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Renalytix AI has no effect on the direction of Cigna Corp i.e., Cigna Corp and Renalytix go up and down completely randomly.
Pair Corralation between Cigna Corp and Renalytix
Allowing for the 90-day total investment horizon Cigna Corp is expected to generate 0.36 times more return on investment than Renalytix. However, Cigna Corp is 2.74 times less risky than Renalytix. It trades about 0.14 of its potential returns per unit of risk. Renalytix AI is currently generating about 0.03 per unit of risk. If you would invest 31,492 in Cigna Corp on August 27, 2024 and sell it today you would earn a total of 1,809 from holding Cigna Corp or generate 5.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cigna Corp vs. Renalytix AI
Performance |
| Timeline |
| Cigna Corp |
| Renalytix AI |
Cigna Corp and Renalytix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cigna Corp and Renalytix
The main advantage of trading using opposite Cigna Corp and Renalytix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cigna Corp position performs unexpectedly, Renalytix 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 Renalytix will offset losses from the drop in Renalytix's long position.| Cigna Corp vs. Elevance Health | Cigna Corp vs. UnitedHealth Group Incorporated | Cigna Corp vs. Centene Corp | Cigna Corp vs. Molina Healthcare |
| Renalytix vs. Streamline Health Solutions | Renalytix vs. HealthStream | Renalytix vs. National Research Corp | Renalytix vs. Forian Inc |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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