Correlation Between 00108WAF7 and UNITEDHEALTH
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By analyzing existing cross correlation between AEP TEX INC and UNITEDHEALTH GROUP INC, you can compare the effects of market volatilities on 00108WAF7 and UNITEDHEALTH 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 00108WAF7 with a short position of UNITEDHEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00108WAF7 and UNITEDHEALTH.
Diversification Opportunities for 00108WAF7 and UNITEDHEALTH
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 00108WAF7 and UNITEDHEALTH is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding AEP TEX INC and UNITEDHEALTH GROUP INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITEDHEALTH GROUP INC and 00108WAF7 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 AEP TEX INC are associated (or correlated) with UNITEDHEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITEDHEALTH GROUP INC has no effect on the direction of 00108WAF7 i.e., 00108WAF7 and UNITEDHEALTH go up and down completely randomly.
Pair Corralation between 00108WAF7 and UNITEDHEALTH
Assuming the 90 days trading horizon AEP TEX INC is expected to generate 2.78 times more return on investment than UNITEDHEALTH. However, 00108WAF7 is 2.78 times more volatile than UNITEDHEALTH GROUP INC. It trades about 0.04 of its potential returns per unit of risk. UNITEDHEALTH GROUP INC is currently generating about 0.01 per unit of risk. If you would invest 7,240 in AEP TEX INC on December 15, 2024 and sell it today you would earn a total of 76.00 from holding AEP TEX INC or generate 1.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 68.18% |
| Values | Daily Returns |
AEP TEX INC vs. UNITEDHEALTH GROUP INC
Performance |
| Timeline |
| AEP TEX INC |
| UNITEDHEALTH GROUP INC |
00108WAF7 and UNITEDHEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00108WAF7 and UNITEDHEALTH
The main advantage of trading using opposite 00108WAF7 and UNITEDHEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00108WAF7 position performs unexpectedly, UNITEDHEALTH 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 UNITEDHEALTH will offset losses from the drop in UNITEDHEALTH's long position.| 00108WAF7 vs. Prudential Financial 4125 | ||
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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