Correlation Between Coca Cola and HUMANA
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By analyzing existing cross correlation between The Coca Cola and HUMANA INC, you can compare the effects of market volatilities on Coca Cola 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 Coca Cola with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and HUMANA.
Diversification Opportunities for Coca Cola and HUMANA
Significant diversification
The 3 months correlation between Coca and HUMANA is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and Coca Cola 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 The Coca Cola 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 Coca Cola i.e., Coca Cola and HUMANA go up and down completely randomly.
Pair Corralation between Coca Cola and HUMANA
Allowing for the 90-day total investment horizon Coca Cola is expected to generate 206.91 times less return on investment than HUMANA. But when comparing it to its historical volatility, The Coca Cola is 97.11 times less risky than HUMANA. It trades about 0.03 of its potential returns per unit of risk. HUMANA INC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 8,043 in HUMANA INC on October 30, 2024 and sell it today you would earn a total of 401.00 from holding HUMANA INC or generate 4.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.94% |
| Values | Daily Returns |
The Coca Cola vs. HUMANA INC
Performance |
| Timeline |
| Coca Cola |
| HUMANA INC |
Coca Cola and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and HUMANA
The main advantage of trading using opposite Coca Cola and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola 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.| Coca Cola vs. PepsiCo | Coca Cola vs. Vita Coco | Coca Cola vs. Aquagold International | Coca Cola vs. Thrivent High Yield |
| HUMANA vs. ServiceNow | HUMANA vs. Allied Gaming Entertainment | HUMANA vs. GameStop Corp | HUMANA vs. Asure Software |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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