Correlation Between Komatsu and HUMANA
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By analyzing existing cross correlation between Komatsu and HUMANA INC, you can compare the effects of market volatilities on Komatsu 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 Komatsu with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Komatsu and HUMANA.
Diversification Opportunities for Komatsu and HUMANA
Good diversification
The 3 months correlation between Komatsu and HUMANA is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Komatsu and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and Komatsu 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 Komatsu 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 Komatsu i.e., Komatsu and HUMANA go up and down completely randomly.
Pair Corralation between Komatsu and HUMANA
Assuming the 90 days horizon Komatsu is expected to generate 1.28 times more return on investment than HUMANA. However, Komatsu is 1.28 times more volatile than HUMANA INC. It trades about 0.05 of its potential returns per unit of risk. HUMANA INC is currently generating about -0.16 per unit of risk. If you would invest 2,760 in Komatsu on September 13, 2024 and sell it today you would earn a total of 57.00 from holding Komatsu or generate 2.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Komatsu vs. HUMANA INC
Performance |
| Timeline |
| Komatsu |
| HUMANA INC |
Komatsu and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Komatsu and HUMANA
The main advantage of trading using opposite Komatsu and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Komatsu 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.| Komatsu vs. HUMANA INC | Komatsu vs. Barloworld Ltd ADR | Komatsu vs. Morningstar Unconstrained Allocation | Komatsu vs. Thrivent High Yield |
| HUMANA vs. Morgan Stanley | HUMANA vs. Infosys Ltd ADR | HUMANA vs. Citizens Bancorp Investment | HUMANA vs. Small Cap Premium |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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