Correlation Between HUMANA and Franklin Street
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By analyzing existing cross correlation between HUMANA INC 395 and Franklin Street Properties, you can compare the effects of market volatilities on HUMANA and Franklin Street 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 HUMANA with a short position of Franklin Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Franklin Street.
Diversification Opportunities for HUMANA and Franklin Street
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HUMANA and Franklin is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC 395 and Franklin Street Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Street Prop and HUMANA 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 HUMANA INC 395 are associated (or correlated) with Franklin Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Street Prop has no effect on the direction of HUMANA i.e., HUMANA and Franklin Street go up and down completely randomly.
Pair Corralation between HUMANA and Franklin Street
Assuming the 90 days trading horizon HUMANA INC 395 is expected to generate 0.12 times more return on investment than Franklin Street. However, HUMANA INC 395 is 8.6 times less risky than Franklin Street. It trades about -0.05 of its potential returns per unit of risk. Franklin Street Properties is currently generating about -0.02 per unit of risk. If you would invest 9,791 in HUMANA INC 395 on September 3, 2024 and sell it today you would lose (30.00) from holding HUMANA INC 395 or give up 0.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
HUMANA INC 395 vs. Franklin Street Properties
Performance |
| Timeline |
| HUMANA INC 5 |
| Franklin Street Prop |
HUMANA and Franklin Street Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Franklin Street
The main advantage of trading using opposite HUMANA and Franklin Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Franklin Street 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 Franklin Street will offset losses from the drop in Franklin Street's long position.The idea behind HUMANA INC 395 and Franklin Street Properties pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Franklin Street vs. Equity Commonwealth | Franklin Street vs. Cousins Properties Incorporated | Franklin Street vs. Creative Media Community | Franklin Street vs. Highwoods Properties |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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