Correlation Between Economic Investment and UnitedHealth Group
Can any of the company-specific risk be diversified away by investing in both Economic Investment and UnitedHealth Group 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 Economic Investment and UnitedHealth Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Economic Investment Trust and UnitedHealth Group CDR, you can compare the effects of market volatilities on Economic Investment and UnitedHealth Group 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 Economic Investment with a short position of UnitedHealth Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Economic Investment and UnitedHealth Group.
Diversification Opportunities for Economic Investment and UnitedHealth Group
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Economic and UnitedHealth is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Economic Investment Trust and UnitedHealth Group CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UnitedHealth Group CDR and Economic Investment 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 Economic Investment Trust are associated (or correlated) with UnitedHealth Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UnitedHealth Group CDR has no effect on the direction of Economic Investment i.e., Economic Investment and UnitedHealth Group go up and down completely randomly.
Pair Corralation between Economic Investment and UnitedHealth Group
Assuming the 90 days trading horizon Economic Investment Trust is expected to generate 0.37 times more return on investment than UnitedHealth Group. However, Economic Investment Trust is 2.74 times less risky than UnitedHealth Group. It trades about 0.29 of its potential returns per unit of risk. UnitedHealth Group CDR is currently generating about -0.01 per unit of risk. If you would invest 16,250 in Economic Investment Trust on October 12, 2024 and sell it today you would earn a total of 650.00 from holding Economic Investment Trust or generate 4.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Economic Investment Trust vs. UnitedHealth Group CDR
Performance |
| Timeline |
| Economic Investment Trust |
| UnitedHealth Group CDR |
Economic Investment and UnitedHealth Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Economic Investment and UnitedHealth Group
The main advantage of trading using opposite Economic Investment and UnitedHealth Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Economic Investment position performs unexpectedly, UnitedHealth Group 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 UnitedHealth Group will offset losses from the drop in UnitedHealth Group's long position.| Economic Investment vs. Uniteds Limited | Economic Investment vs. E L Financial Corp | Economic Investment vs. Canadian General Investments | Economic Investment vs. Clairvest Group |
| UnitedHealth Group vs. Leons Furniture Limited | UnitedHealth Group vs. Rogers Communications | UnitedHealth Group vs. Economic Investment Trust | UnitedHealth Group vs. Bausch Health Companies |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |