Correlation Between Disney and HUMANA
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By analyzing existing cross correlation between Walt Disney and HUMANA INC 395, you can compare the effects of market volatilities on Disney 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 Disney with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Disney and HUMANA.
Diversification Opportunities for Disney and HUMANA
Weak diversification
The 3 months correlation between Disney and HUMANA is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Walt Disney and HUMANA INC 395 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC 5 and Disney 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 Walt Disney 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 5 has no effect on the direction of Disney i.e., Disney and HUMANA go up and down completely randomly.
Pair Corralation between Disney and HUMANA
Considering the 90-day investment horizon Walt Disney is expected to under-perform the HUMANA. In addition to that, Disney is 10.51 times more volatile than HUMANA INC 395. It trades about -0.13 of its total potential returns per unit of risk. HUMANA INC 395 is currently generating about 0.07 per unit of volatility. If you would invest 9,831 in HUMANA INC 395 on November 27, 2024 and sell it today you would earn a total of 14.00 from holding HUMANA INC 395 or generate 0.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Walt Disney vs. HUMANA INC 395
Performance |
| Timeline |
| Walt Disney |
| HUMANA INC 5 |
Disney and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Disney and HUMANA
The main advantage of trading using opposite Disney and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Disney 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.| Disney vs. Roku Inc | Disney vs. AMC Entertainment Holdings | Disney vs. Paramount Global Class | Disney vs. Warner Bros Discovery |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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