Correlation Between Europac International and HUMANA
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By analyzing existing cross correlation between Europac International Dividend and HUMANA INC, you can compare the effects of market volatilities on Europac International 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 Europac International with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Europac International and HUMANA.
Diversification Opportunities for Europac International and HUMANA
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Europac and HUMANA is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Europac International Dividend and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and Europac International 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 Europac International Dividend 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 Europac International i.e., Europac International and HUMANA go up and down completely randomly.
Pair Corralation between Europac International and HUMANA
Assuming the 90 days horizon Europac International Dividend is expected to generate 1.14 times more return on investment than HUMANA. However, Europac International is 1.14 times more volatile than HUMANA INC. It trades about 0.08 of its potential returns per unit of risk. HUMANA INC is currently generating about -0.03 per unit of risk. If you would invest 866.00 in Europac International Dividend on September 1, 2024 and sell it today you would earn a total of 103.00 from holding Europac International Dividend or generate 11.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.35% |
| Values | Daily Returns |
Europac International Dividend vs. HUMANA INC
Performance |
| Timeline |
| Europac International |
| HUMANA INC |
Europac International and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Europac International and HUMANA
The main advantage of trading using opposite Europac International and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Europac International 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.The idea behind Europac International Dividend and HUMANA INC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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