Correlation Between Humana and Zhongchao
Can any of the company-specific risk be diversified away by investing in both Humana and Zhongchao 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 Zhongchao into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humana Inc and Zhongchao, you can compare the effects of market volatilities on Humana and Zhongchao 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 Zhongchao. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humana and Zhongchao.
Diversification Opportunities for Humana and Zhongchao
Very good diversification
The 3 months correlation between Humana and Zhongchao is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Zhongchao in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongchao 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 Zhongchao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongchao has no effect on the direction of Humana i.e., Humana and Zhongchao go up and down completely randomly.
Pair Corralation between Humana and Zhongchao
Considering the 90-day investment horizon Humana Inc is expected to under-perform the Zhongchao. But the etf apears to be less risky and, when comparing its historical volatility, Humana Inc is 1.36 times less risky than Zhongchao. The etf trades about -0.32 of its potential returns per unit of risk. The Zhongchao is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 142.00 in Zhongchao on November 27, 2024 and sell it today you would lose (3.00) from holding Zhongchao or give up 2.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Humana Inc vs. Zhongchao
Performance |
| Timeline |
| Humana Inc |
| Zhongchao |
Humana and Zhongchao Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humana and Zhongchao
The main advantage of trading using opposite Humana and Zhongchao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humana position performs unexpectedly, Zhongchao 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 Zhongchao will offset losses from the drop in Zhongchao's long position.| Humana vs. Elevance Health | Humana vs. Centene Corp | Humana vs. UnitedHealth Group Incorporated | Humana vs. CVS Health Corp |
| Zhongchao vs. Nano Mobile Healthcare | Zhongchao vs. Healthcare Triangle | Zhongchao vs. Cannabis Sativa | Zhongchao vs. FOXO Technologies |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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