Correlation Between Humana and Innovator Loup
Can any of the company-specific risk be diversified away by investing in both Humana and Innovator Loup 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 Innovator Loup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and Innovator Loup Frontier, you can compare the effects of market volatilities on Humana and Innovator Loup 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 Innovator Loup. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and Innovator Loup.
Diversification Opportunities for Humana and Innovator Loup
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Humana and Innovator is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Innovator Loup Frontier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovator Loup Frontier 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 Innovator Loup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovator Loup Frontier has no effect on the direction of Humana i.e., Humana and Innovator Loup go up and down completely randomly.
Pair Corralation between Humana and Innovator Loup
Considering the 90-day investment horizon Humana Inc is expected to generate 1.82 times more return on investment than Innovator Loup. However, Humana is 1.82 times more volatile than Innovator Loup Frontier. It trades about 0.23 of its potential returns per unit of risk. Innovator Loup Frontier is currently generating about 0.33 per unit of risk. If you would invest 25,555 in Humana Inc on September 4, 2024 and sell it today you would earn a total of 3,758 from holding Humana Inc or generate 14.71% 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. Innovator Loup Frontier
Performance |
| Timeline |
| Humana Inc |
| Innovator Loup Frontier |
Humana and Innovator Loup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and Innovator Loup
The main advantage of trading using opposite Humana and Innovator Loup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, Innovator Loup 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 Innovator Loup will offset losses from the drop in Innovator Loup's long position.| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana vs. CVS Health Corp |
| Innovator Loup vs. First Trust Nasdaq | Innovator Loup vs. SPDR FactSet Innovative | Innovator Loup vs. Defiance Quantum ETF | Innovator Loup vs. SPDR Kensho New |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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