Correlation Between Home Depot and ANTHEM

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Home Depot and ANTHEM 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 Home Depot and ANTHEM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Depot and ANTHEM INC 4101, you can compare the effects of market volatilities on Home Depot and ANTHEM 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 Home Depot with a short position of ANTHEM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and ANTHEM.

Diversification Opportunities for Home Depot and ANTHEM

-0.52
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Home and ANTHEM is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Home Depot and ANTHEM INC 4101 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTHEM INC 4101 and Home Depot 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 Home Depot are associated (or correlated) with ANTHEM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTHEM INC 4101 has no effect on the direction of Home Depot i.e., Home Depot and ANTHEM go up and down completely randomly.

Pair Corralation between Home Depot and ANTHEM

Allowing for the 90-day total investment horizon Home Depot is expected to generate 4.32 times more return on investment than ANTHEM. However, Home Depot is 4.32 times more volatile than ANTHEM INC 4101. It trades about 0.09 of its potential returns per unit of risk. ANTHEM INC 4101 is currently generating about 0.0 per unit of risk. If you would invest  34,634  in Home Depot on August 28, 2024 and sell it today you would earn a total of  8,233  from holding Home Depot or generate 23.77% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy99.04%
ValuesDaily Returns

Home Depot  vs.  ANTHEM INC 4101

 Performance 
       Timeline  
Home Depot 

Risk-Adjusted Performance

15 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Home Depot are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain fundamental indicators, Home Depot exhibited solid returns over the last few months and may actually be approaching a breakup point.
ANTHEM INC 4101 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days ANTHEM INC 4101 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ANTHEM is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Home Depot and ANTHEM Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Home Depot and ANTHEM

The main advantage of trading using opposite Home Depot and ANTHEM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Depot position performs unexpectedly, ANTHEM 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 ANTHEM will offset losses from the drop in ANTHEM's long position.
Home Depot vs. Arhaus Inc
Home Depot vs. Haverty Furniture Companies
Home Depot vs. Kirklands
Home Depot vs. Haverty Furniture Companies
The idea behind Home Depot and ANTHEM INC 4101 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.
ANTHEM vs. AEP TEX INC
ANTHEM vs. US BANK NATIONAL
ANTHEM vs. Eat Beyond Global
ANTHEM vs. Charles Schwab 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.

Other Complementary Tools

Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Share Portfolio
Track or share privately all of your investments from the convenience of any device
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios


 
Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions
 
Feedback Blog
Made with optimal in San Francisco
2024 Macroaxis LLC
COMMON DESTINATIONS
MAIN CATEGORIES
COMPANY