Correlation Between Western Asset and HUMANA
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By analyzing existing cross correlation between Western Asset Investment and HUMANA INC, you can compare the effects of market volatilities on Western Asset and HUMANA 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 Western Asset with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and HUMANA.
Diversification Opportunities for Western Asset and HUMANA
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Western and HUMANA is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Investment and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and Western Asset 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 Western Asset Investment are associated (or correlated) with HUMANA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUMANA INC has no effect on the direction of Western Asset i.e., Western Asset and HUMANA go up and down completely randomly.
Pair Corralation between Western Asset and HUMANA
Considering the 90-day investment horizon Western Asset Investment is expected to generate 0.43 times more return on investment than HUMANA. However, Western Asset Investment is 2.33 times less risky than HUMANA. It trades about -0.01 of its potential returns per unit of risk. HUMANA INC is currently generating about -0.21 per unit of risk. If you would invest 1,675 in Western Asset Investment on August 31, 2024 and sell it today you would lose (2.00) from holding Western Asset Investment or give up 0.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Western Asset Investment vs. HUMANA INC
Performance |
| Timeline |
| Western Asset Investment |
| HUMANA INC |
Western Asset and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and HUMANA
The main advantage of trading using opposite Western Asset and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, HUMANA 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 HUMANA will offset losses from the drop in HUMANA's long position.| Western Asset vs. HUMANA INC | Western Asset vs. SCOR PK | Western Asset vs. Aquagold International | Western Asset vs. Thrivent High Yield |
| HUMANA vs. Air Products and | HUMANA vs. GE Vernova LLC | HUMANA vs. Aris Water Solutions | HUMANA vs. Pure Cycle |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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