Correlation Between HUMANA and Air France
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By analyzing existing cross correlation between HUMANA INC and Air France KLM, you can compare the effects of market volatilities on HUMANA and Air France 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 Air France. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Air France.
Diversification Opportunities for HUMANA and Air France
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HUMANA and Air is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Air France KLM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air France KLM 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 are associated (or correlated) with Air France. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air France KLM has no effect on the direction of HUMANA i.e., HUMANA and Air France go up and down completely randomly.
Pair Corralation between HUMANA and Air France
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Air France. But the bond apears to be less risky and, when comparing its historical volatility, HUMANA INC is 1.43 times less risky than Air France. The bond trades about -0.16 of its potential returns per unit of risk. The Air France KLM is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 84.00 in Air France KLM on September 18, 2024 and sell it today you would lose (3.00) from holding Air France KLM or give up 3.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
HUMANA INC vs. Air France KLM
Performance |
| Timeline |
| HUMANA INC |
| Air France KLM |
HUMANA and Air France Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Air France
The main advantage of trading using opposite HUMANA and Air France positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Air France 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 Air France will offset losses from the drop in Air France's long position.| HUMANA vs. Discover Financial Services | HUMANA vs. Chiba Bank Ltd | HUMANA vs. Willamette Valley Vineyards | HUMANA vs. Oatly Group AB |
| Air France vs. HUMANA INC | Air France vs. Barloworld Ltd ADR | Air France vs. Morningstar Unconstrained Allocation | Air France vs. Thrivent High Yield |
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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