Correlation Between RCI Hospitality and HUMANA
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By analyzing existing cross correlation between RCI Hospitality Holdings and HUMANA INC, you can compare the effects of market volatilities on RCI Hospitality 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 RCI Hospitality with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of RCI Hospitality and HUMANA.
Diversification Opportunities for RCI Hospitality and HUMANA
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between RCI and HUMANA is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding RCI Hospitality Holdings and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and RCI Hospitality 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 RCI Hospitality Holdings 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 RCI Hospitality i.e., RCI Hospitality and HUMANA go up and down completely randomly.
Pair Corralation between RCI Hospitality and HUMANA
Given the investment horizon of 90 days RCI Hospitality Holdings is expected to under-perform the HUMANA. But the stock apears to be less risky and, when comparing its historical volatility, RCI Hospitality Holdings is 35.82 times less risky than HUMANA. The stock trades about -0.03 of its potential returns per unit of risk. The 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 Against |
| Strength | Insignificant |
| Accuracy | 94.94% |
| Values | Daily Returns |
RCI Hospitality Holdings vs. HUMANA INC
Performance |
| Timeline |
| RCI Hospitality Holdings |
| HUMANA INC |
RCI Hospitality and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RCI Hospitality and HUMANA
The main advantage of trading using opposite RCI Hospitality and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RCI Hospitality 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.| RCI Hospitality vs. Brinker International | RCI Hospitality vs. Bloomin Brands | RCI Hospitality vs. BJs Restaurants | RCI Hospitality vs. Dennys Corp |
| 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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