Correlation Between Humana AB and Attendo AB
Can any of the company-specific risk be diversified away by investing in both Humana AB and Attendo AB 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 Humana AB and Attendo AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana AB and Attendo AB, you can compare the effects of market volatilities on Humana AB and Attendo AB 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 Humana AB with a short position of Attendo AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana AB and Attendo AB.
Diversification Opportunities for Humana AB and Attendo AB
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Humana and Attendo is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Humana AB and Attendo AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Attendo AB and Humana AB 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 Humana AB are associated (or correlated) with Attendo AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Attendo AB has no effect on the direction of Humana AB i.e., Humana AB and Attendo AB go up and down completely randomly.
Pair Corralation between Humana AB and Attendo AB
Assuming the 90 days trading horizon Humana AB is expected to under-perform the Attendo AB. In addition to that, Humana AB is 2.19 times more volatile than Attendo AB. It trades about -0.09 of its total potential returns per unit of risk. Attendo AB is currently generating about -0.11 per unit of volatility. If you would invest 4,950 in Attendo AB on August 26, 2024 and sell it today you would lose (130.00) from holding Attendo AB or give up 2.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Humana AB vs. Attendo AB
Performance |
| Timeline |
| Humana AB |
| Attendo AB |
Humana AB and Attendo AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana AB and Attendo AB
The main advantage of trading using opposite Humana AB and Attendo AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana AB position performs unexpectedly, Attendo AB 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 Attendo AB will offset losses from the drop in Attendo AB's long position.The idea behind Humana AB and Attendo AB 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.| Attendo AB vs. Humana AB | Attendo AB vs. Ambea AB | Attendo AB vs. Dometic Group AB | Attendo AB vs. Bonava AB |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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