Correlation Between Humana and Pacer Emerging
Can any of the company-specific risk be diversified away by investing in both Humana and Pacer Emerging 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 Pacer Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and Pacer Emerging Markets, you can compare the effects of market volatilities on Humana and Pacer Emerging 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 Pacer Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and Pacer Emerging.
Diversification Opportunities for Humana and Pacer Emerging
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Humana and Pacer is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Pacer Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacer Emerging Markets 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 Pacer Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacer Emerging Markets has no effect on the direction of Humana i.e., Humana and Pacer Emerging go up and down completely randomly.
Pair Corralation between Humana and Pacer Emerging
Considering the 90-day investment horizon Humana Inc is expected to under-perform the Pacer Emerging. In addition to that, Humana is 2.28 times more volatile than Pacer Emerging Markets. It trades about -0.02 of its total potential returns per unit of risk. Pacer Emerging Markets is currently generating about 0.0 per unit of volatility. If you would invest 2,069 in Pacer Emerging Markets on August 28, 2024 and sell it today you would lose (21.00) from holding Pacer Emerging Markets or give up 1.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Humana Inc vs. Pacer Emerging Markets
Performance |
| Timeline |
| Humana Inc |
| Pacer Emerging Markets |
Humana and Pacer Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and Pacer Emerging
The main advantage of trading using opposite Humana and Pacer Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, Pacer Emerging 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 Pacer Emerging will offset losses from the drop in Pacer Emerging's long position.| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana vs. CVS Health Corp |
| Pacer Emerging vs. Invesco PureBeta MSCI | Pacer Emerging vs. Aquagold International | Pacer Emerging vs. Morningstar Unconstrained Allocation | Pacer Emerging vs. High Yield Municipal Fund |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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