Correlation Between UnitedHealth Group and Iron Mountain
Can any of the company-specific risk be diversified away by investing in both UnitedHealth Group and Iron Mountain 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 Iron Mountain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UnitedHealth Group Incorporated and Iron Mountain Incorporated, you can compare the effects of market volatilities on UnitedHealth Group and Iron Mountain 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 Iron Mountain. Check out your portfolio center. Please also check ongoing floating volatility patterns of UnitedHealth Group and Iron Mountain.
Diversification Opportunities for UnitedHealth Group and Iron Mountain
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between UnitedHealth and Iron is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding UnitedHealth Group Incorporate and Iron Mountain Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iron Mountain 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 Incorporated are associated (or correlated) with Iron Mountain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iron Mountain has no effect on the direction of UnitedHealth Group i.e., UnitedHealth Group and Iron Mountain go up and down completely randomly.
Pair Corralation between UnitedHealth Group and Iron Mountain
Assuming the 90 days trading horizon UnitedHealth Group Incorporated is expected to generate 0.78 times more return on investment than Iron Mountain. However, UnitedHealth Group Incorporated is 1.28 times less risky than Iron Mountain. It trades about 0.21 of its potential returns per unit of risk. Iron Mountain Incorporated is currently generating about -0.11 per unit of risk. If you would invest 4,625 in UnitedHealth Group Incorporated on August 29, 2024 and sell it today you would earn a total of 425.00 from holding UnitedHealth Group Incorporated or generate 9.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
UnitedHealth Group Incorporate vs. Iron Mountain Incorporated
Performance |
| Timeline |
| UnitedHealth Group |
| Iron Mountain |
UnitedHealth Group and Iron Mountain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UnitedHealth Group and Iron Mountain
The main advantage of trading using opposite UnitedHealth Group and Iron Mountain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UnitedHealth Group position performs unexpectedly, Iron Mountain 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 Iron Mountain will offset losses from the drop in Iron Mountain's long position.| UnitedHealth Group vs. Odontoprev SA | UnitedHealth Group vs. Qualicorp Consultoria e | UnitedHealth Group vs. Energisa SA | UnitedHealth Group vs. BTG Pactual Logstica |
| Iron Mountain vs. Global X Funds | Iron Mountain vs. Costco Wholesale | Iron Mountain vs. Warner Music Group | Iron Mountain vs. UnitedHealth Group Incorporated |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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