Correlation Between Humana and Freedom Day
Can any of the company-specific risk be diversified away by investing in both Humana and Freedom Day 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 Freedom Day into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and Freedom Day Dividend, you can compare the effects of market volatilities on Humana and Freedom Day 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 Freedom Day. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and Freedom Day.
Diversification Opportunities for Humana and Freedom Day
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Humana and Freedom is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Freedom Day Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freedom Day Dividend 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 Freedom Day. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freedom Day Dividend has no effect on the direction of Humana i.e., Humana and Freedom Day go up and down completely randomly.
Pair Corralation between Humana and Freedom Day
Considering the 90-day investment horizon Humana Inc is expected to generate 3.59 times more return on investment than Freedom Day. However, Humana is 3.59 times more volatile than Freedom Day Dividend. It trades about 0.18 of its potential returns per unit of risk. Freedom Day Dividend is currently generating about 0.16 per unit of risk. If you would invest 26,231 in Humana Inc on August 23, 2024 and sell it today you would earn a total of 3,340 from holding Humana Inc or generate 12.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Humana Inc vs. Freedom Day Dividend
Performance |
| Timeline |
| Humana Inc |
| Freedom Day Dividend |
Humana and Freedom Day Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and Freedom Day
The main advantage of trading using opposite Humana and Freedom Day positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, Freedom Day 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 Freedom Day will offset losses from the drop in Freedom Day's 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Stocks Directory Find actively traded stocks across global markets |