Correlation Between Humana and Sprott Copper
Can any of the company-specific risk be diversified away by investing in both Humana and Sprott Copper 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 and Sprott Copper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and Sprott Copper Miners, you can compare the effects of market volatilities on Humana and Sprott Copper 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 with a short position of Sprott Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and Sprott Copper.
Diversification Opportunities for Humana and Sprott Copper
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Humana and Sprott is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Sprott Copper Miners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Copper Miners and Humana 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 Inc are associated (or correlated) with Sprott Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott Copper Miners has no effect on the direction of Humana i.e., Humana and Sprott Copper go up and down completely randomly.
Pair Corralation between Humana and Sprott Copper
Considering the 90-day investment horizon Humana Inc is expected to generate 0.44 times more return on investment than Sprott Copper. However, Humana Inc is 2.27 times less risky than Sprott Copper. It trades about 0.05 of its potential returns per unit of risk. Sprott Copper Miners is currently generating about -0.18 per unit of risk. If you would invest 25,043 in Humana Inc on January 7, 2025 and sell it today you would earn a total of 428.00 from holding Humana Inc or generate 1.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Humana Inc vs. Sprott Copper Miners
Performance |
| Timeline |
| Humana Inc |
| Sprott Copper Miners |
Humana and Sprott Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and Sprott Copper
The main advantage of trading using opposite Humana and Sprott Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, Sprott Copper 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 Sprott Copper will offset losses from the drop in Sprott Copper's long position.| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana vs. CVS Health Corp |
| Sprott Copper vs. Ultimus Managers Trust | Sprott Copper vs. American Beacon Select | Sprott Copper vs. First Trust Indxx | Sprott Copper vs. Direxion Daily Regional |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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