Correlation Between Ensign and Humana
Can any of the company-specific risk be diversified away by investing in both Ensign and Humana 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 Ensign and Humana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Ensign Group and Humana Inc, you can compare the effects of market volatilities on Ensign 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 Ensign with a short position of Humana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ensign and Humana.
Diversification Opportunities for Ensign and Humana
Average diversification
The 3 months correlation between Ensign and Humana is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding The Ensign Group and Humana Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humana Inc and Ensign 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 The Ensign Group 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 Ensign i.e., Ensign and Humana go up and down completely randomly.
Pair Corralation between Ensign and Humana
Given the investment horizon of 90 days The Ensign Group is expected to generate 0.59 times more return on investment than Humana. However, The Ensign Group is 1.69 times less risky than Humana. It trades about 0.09 of its potential returns per unit of risk. Humana Inc is currently generating about -0.06 per unit of risk. If you would invest 9,630 in The Ensign Group on September 12, 2024 and sell it today you would earn a total of 4,656 from holding The Ensign Group or generate 48.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Ensign Group vs. Humana Inc
Performance |
| Timeline |
| Ensign Group |
| Humana Inc |
Ensign and Humana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ensign and Humana
The main advantage of trading using opposite Ensign and Humana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ensign 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.| Ensign vs. Enhabit | Ensign vs. Pennant Group | Ensign vs. InnovAge Holding Corp | Ensign vs. National HealthCare |
| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |