Correlation Between Humana and Hartford Short
Can any of the company-specific risk be diversified away by investing in both Humana and Hartford Short 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 Hartford Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and Hartford Short Duration, you can compare the effects of market volatilities on Humana and Hartford Short 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 Hartford Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and Hartford Short.
Diversification Opportunities for Humana and Hartford Short
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Humana and Hartford is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Hartford Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Short Duration 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 Hartford Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Short Duration has no effect on the direction of Humana i.e., Humana and Hartford Short go up and down completely randomly.
Pair Corralation between Humana and Hartford Short
Considering the 90-day investment horizon Humana Inc is expected to generate 23.38 times more return on investment than Hartford Short. However, Humana is 23.38 times more volatile than Hartford Short Duration. It trades about 0.21 of its potential returns per unit of risk. Hartford Short Duration is currently generating about 0.05 per unit of risk. If you would invest 25,777 in Humana Inc on August 30, 2024 and sell it today you would earn a total of 3,891 from holding Humana Inc or generate 15.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Humana Inc vs. Hartford Short Duration
Performance |
| Timeline |
| Humana Inc |
| Hartford Short Duration |
Humana and Hartford Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and Hartford Short
The main advantage of trading using opposite Humana and Hartford Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, Hartford Short 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 Hartford Short will offset losses from the drop in Hartford Short's long position.| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana vs. CVS Health Corp |
| Hartford Short vs. Hartford Total Return | Hartford Short vs. iShares Edge Investment | Hartford Short vs. Hartford Schroders Tax Aware | Hartford Short vs. ClearShares Ultra Short Maturity |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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