Correlation Between MetLife and AETNA
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By analyzing existing cross correlation between MetLife and AETNA INC NEW, you can compare the effects of market volatilities on MetLife and AETNA 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 MetLife with a short position of AETNA. Check out your portfolio center. Please also check ongoing floating volatility patterns of MetLife and AETNA.
Diversification Opportunities for MetLife and AETNA
Very good diversification
The 3 months correlation between MetLife and AETNA is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding MetLife and AETNA INC NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AETNA INC NEW and MetLife 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 MetLife are associated (or correlated) with AETNA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AETNA INC NEW has no effect on the direction of MetLife i.e., MetLife and AETNA go up and down completely randomly.
Pair Corralation between MetLife and AETNA
Considering the 90-day investment horizon MetLife is expected to generate 5.47 times more return on investment than AETNA. However, MetLife is 5.47 times more volatile than AETNA INC NEW. It trades about 0.1 of its potential returns per unit of risk. AETNA INC NEW is currently generating about 0.02 per unit of risk. If you would invest 6,296 in MetLife on September 4, 2024 and sell it today you would earn a total of 2,276 from holding MetLife or generate 36.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.33% |
| Values | Daily Returns |
MetLife vs. AETNA INC NEW
Performance |
| Timeline |
| MetLife |
| AETNA INC NEW |
MetLife and AETNA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MetLife and AETNA
The main advantage of trading using opposite MetLife and AETNA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MetLife position performs unexpectedly, AETNA 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 AETNA will offset losses from the drop in AETNA's long position.| MetLife vs. Aflac Incorporated | MetLife vs. Manulife Financial Corp | MetLife vs. Jackson Financial | MetLife vs. Globe Life |
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 CEOs Directory module to screen CEOs from public companies around the world.
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