Correlation Between Humana and IShares China
Can any of the company-specific risk be diversified away by investing in both Humana and IShares China 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 IShares China into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and iShares China Large Cap, you can compare the effects of market volatilities on Humana and IShares China 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 IShares China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and IShares China.
Diversification Opportunities for Humana and IShares China
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Humana and IShares is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and iShares China Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares China Large 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 IShares China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares China Large has no effect on the direction of Humana i.e., Humana and IShares China go up and down completely randomly.
Pair Corralation between Humana and IShares China
Considering the 90-day investment horizon Humana Inc is expected to under-perform the IShares China. In addition to that, Humana is 1.11 times more volatile than iShares China Large Cap. It trades about -0.04 of its total potential returns per unit of risk. iShares China Large Cap is currently generating about 0.02 per unit of volatility. If you would invest 2,726 in iShares China Large Cap on August 27, 2024 and sell it today you would earn a total of 243.00 from holding iShares China Large Cap or generate 8.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Humana Inc vs. iShares China Large Cap
Performance |
| Timeline |
| Humana Inc |
| iShares China Large |
Humana and IShares China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and IShares China
The main advantage of trading using opposite Humana and IShares China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, IShares China 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 IShares China will offset losses from the drop in IShares China's long position.| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana vs. CVS Health Corp |
| IShares China vs. iShares MSCI Brazil | IShares China vs. iShares MSCI Emerging | IShares China vs. iShares MSCI Japan | IShares China vs. iShares MSCI Hong |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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