Correlation Between HUMANA and Alger Funds
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By analyzing existing cross correlation between HUMANA INC and The Alger Funds, you can compare the effects of market volatilities on HUMANA and Alger Funds 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 Alger Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Alger Funds.
Diversification Opportunities for HUMANA and Alger Funds
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HUMANA and Alger is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and The Alger Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Funds 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 Alger Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Funds has no effect on the direction of HUMANA i.e., HUMANA and Alger Funds go up and down completely randomly.
Pair Corralation between HUMANA and Alger Funds
Assuming the 90 days trading horizon HUMANA INC is expected to generate 64.58 times more return on investment than Alger Funds. However, HUMANA is 64.58 times more volatile than The Alger Funds. It trades about 0.07 of its potential returns per unit of risk. The Alger Funds is currently generating about 0.06 per unit of risk. If you would invest 7,953 in HUMANA INC on September 12, 2024 and sell it today you would lose (258.00) from holding HUMANA INC or give up 3.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.94% |
| Values | Daily Returns |
HUMANA INC vs. The Alger Funds
Performance |
| Timeline |
| HUMANA INC |
| Alger Funds |
HUMANA and Alger Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Alger Funds
The main advantage of trading using opposite HUMANA and Alger Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Alger Funds 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 Alger Funds will offset losses from the drop in Alger Funds' long position.The idea behind HUMANA INC and The Alger Funds 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.| Alger Funds vs. Needham Aggressive Growth | Alger Funds vs. Ultramid Cap Profund Ultramid Cap | Alger Funds vs. HUMANA INC | Alger Funds vs. Barloworld Ltd ADR |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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