Correlation Between Sierra Tactical and HUMANA
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By analyzing existing cross correlation between Sierra Tactical Bond and HUMANA INC, you can compare the effects of market volatilities on Sierra Tactical 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 Sierra Tactical with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sierra Tactical and HUMANA.
Diversification Opportunities for Sierra Tactical and HUMANA
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sierra and HUMANA is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Sierra Tactical Bond and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and Sierra Tactical 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 Sierra Tactical Bond 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 Sierra Tactical i.e., Sierra Tactical and HUMANA go up and down completely randomly.
Pair Corralation between Sierra Tactical and HUMANA
Assuming the 90 days horizon Sierra Tactical is expected to generate 274.31 times less return on investment than HUMANA. But when comparing it to its historical volatility, Sierra Tactical Bond is 298.85 times less risky than HUMANA. It trades about 0.08 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 8,028 in HUMANA INC on August 30, 2024 and sell it today you would lose (333.00) from holding HUMANA INC or give up 4.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.74% |
| Values | Daily Returns |
Sierra Tactical Bond vs. HUMANA INC
Performance |
| Timeline |
| Sierra Tactical Bond |
| HUMANA INC |
Sierra Tactical and HUMANA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sierra Tactical and HUMANA
The main advantage of trading using opposite Sierra Tactical and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sierra Tactical 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.| Sierra Tactical vs. HUMANA INC | Sierra Tactical vs. Aquagold International | Sierra Tactical vs. Barloworld Ltd ADR | Sierra Tactical vs. Morningstar Unconstrained Allocation |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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