Correlation Between Clover Health and Cigna Corp
Can any of the company-specific risk be diversified away by investing in both Clover Health and Cigna 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 Clover Health and Cigna Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clover Health Investments and Cigna Corp, you can compare the effects of market volatilities on Clover Health and Cigna 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 Clover Health with a short position of Cigna Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clover Health and Cigna Corp.
Diversification Opportunities for Clover Health and Cigna Corp
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Clover and Cigna is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Clover Health Investments and Cigna Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cigna Corp and Clover Health 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 Clover Health Investments are associated (or correlated) with Cigna Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cigna Corp has no effect on the direction of Clover Health i.e., Clover Health and Cigna Corp go up and down completely randomly.
Pair Corralation between Clover Health and Cigna Corp
Given the investment horizon of 90 days Clover Health Investments is expected to under-perform the Cigna Corp. In addition to that, Clover Health is 2.14 times more volatile than Cigna Corp. It trades about -0.1 of its total potential returns per unit of risk. Cigna Corp is currently generating about 0.09 per unit of volatility. If you would invest 31,757 in Cigna Corp on August 24, 2024 and sell it today you would earn a total of 1,250 from holding Cigna Corp or generate 3.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clover Health Investments vs. Cigna Corp
Performance |
| Timeline |
| Clover Health Investments |
| Cigna Corp |
Clover Health and Cigna Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clover Health and Cigna Corp
The main advantage of trading using opposite Clover Health and Cigna Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clover Health position performs unexpectedly, Cigna 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 Cigna Corp will offset losses from the drop in Cigna Corp's long position.| Clover Health vs. Skillz Platform | Clover Health vs. BlackBerry | Clover Health vs. Fubotv Inc | Clover Health vs. SNDL Inc |
| Cigna Corp vs. Elevance Health | Cigna Corp vs. UnitedHealth Group Incorporated | Cigna Corp vs. Centene Corp | Cigna Corp vs. Molina Healthcare |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |