Correlation Between Humana and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Humana and Goldman Sachs 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 Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and Goldman Sachs Access, you can compare the effects of market volatilities on Humana and Goldman Sachs 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 Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and Goldman Sachs.
Diversification Opportunities for Humana and Goldman Sachs
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Humana and Goldman is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Goldman Sachs Access in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Access 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 Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs Access has no effect on the direction of Humana i.e., Humana and Goldman Sachs go up and down completely randomly.
Pair Corralation between Humana and Goldman Sachs
Considering the 90-day investment horizon Humana Inc is expected to under-perform the Goldman Sachs. In addition to that, Humana is 6.43 times more volatile than Goldman Sachs Access. It trades about -0.05 of its total potential returns per unit of risk. Goldman Sachs Access is currently generating about 0.12 per unit of volatility. If you would invest 3,891 in Goldman Sachs Access on August 31, 2024 and sell it today you would earn a total of 650.00 from holding Goldman Sachs Access or generate 16.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Humana Inc vs. Goldman Sachs Access
Performance |
| Timeline |
| Humana Inc |
| Goldman Sachs Access |
Humana and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and Goldman Sachs
The main advantage of trading using opposite Humana and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana vs. CVS Health 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |