Correlation Between UnitedHealth Group and Primaris Retail
Can any of the company-specific risk be diversified away by investing in both UnitedHealth Group and Primaris Retail at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining UnitedHealth Group and Primaris Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UnitedHealth Group CDR and Primaris Retail RE, you can compare the effects of market volatilities on UnitedHealth Group and Primaris Retail 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 UnitedHealth Group with a short position of Primaris Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of UnitedHealth Group and Primaris Retail.
Diversification Opportunities for UnitedHealth Group and Primaris Retail
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between UnitedHealth and Primaris is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding UnitedHealth Group CDR and Primaris Retail RE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Primaris Retail RE and UnitedHealth Group 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 UnitedHealth Group CDR are associated (or correlated) with Primaris Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Primaris Retail RE has no effect on the direction of UnitedHealth Group i.e., UnitedHealth Group and Primaris Retail go up and down completely randomly.
Pair Corralation between UnitedHealth Group and Primaris Retail
Assuming the 90 days trading horizon UnitedHealth Group CDR is expected to generate 2.54 times more return on investment than Primaris Retail. However, UnitedHealth Group is 2.54 times more volatile than Primaris Retail RE. It trades about 0.18 of its potential returns per unit of risk. Primaris Retail RE is currently generating about 0.19 per unit of risk. If you would invest 2,699 in UnitedHealth Group CDR on September 1, 2024 and sell it today you would earn a total of 202.00 from holding UnitedHealth Group CDR or generate 7.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UnitedHealth Group CDR vs. Primaris Retail RE
Performance |
| Timeline |
| UnitedHealth Group CDR |
| Primaris Retail RE |
UnitedHealth Group and Primaris Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UnitedHealth Group and Primaris Retail
The main advantage of trading using opposite UnitedHealth Group and Primaris Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UnitedHealth Group position performs unexpectedly, Primaris Retail 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 Primaris Retail will offset losses from the drop in Primaris Retail's long position.| UnitedHealth Group vs. Exco Technologies Limited | UnitedHealth Group vs. Quorum Information Technologies | UnitedHealth Group vs. Rogers Communications | UnitedHealth Group vs. Ocumetics Technology Corp |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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