Correlation Between Humana and Sprott Junior
Can any of the company-specific risk be diversified away by investing in both Humana and Sprott Junior 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 Sprott Junior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and Sprott Junior Gold, you can compare the effects of market volatilities on Humana and Sprott Junior 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 Sprott Junior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and Sprott Junior.
Diversification Opportunities for Humana and Sprott Junior
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Humana and Sprott is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Sprott Junior Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Junior Gold 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 Sprott Junior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott Junior Gold has no effect on the direction of Humana i.e., Humana and Sprott Junior go up and down completely randomly.
Pair Corralation between Humana and Sprott Junior
Considering the 90-day investment horizon Humana Inc is expected to generate 1.51 times more return on investment than Sprott Junior. However, Humana is 1.51 times more volatile than Sprott Junior Gold. It trades about 0.21 of its potential returns per unit of risk. Sprott Junior Gold is currently generating about -0.2 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. Sprott Junior Gold
Performance |
| Timeline |
| Humana Inc |
| Sprott Junior Gold |
Humana and Sprott Junior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and Sprott Junior
The main advantage of trading using opposite Humana and Sprott Junior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, Sprott Junior 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 Sprott Junior will offset losses from the drop in Sprott Junior's long position.| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana vs. CVS Health Corp |
| Sprott Junior vs. Sprott Gold Miners | Sprott Junior vs. Amplify ETF Trust | Sprott Junior vs. US Global GO | Sprott Junior vs. Global X Gold |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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