Correlation Between HUMANA and CannBioRx Life
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By analyzing existing cross correlation between HUMANA INC and CannBioRx Life Sciences, you can compare the effects of market volatilities on HUMANA and CannBioRx Life 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 CannBioRx Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and CannBioRx Life.
Diversification Opportunities for HUMANA and CannBioRx Life
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HUMANA and CannBioRx is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and CannBioRx Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CannBioRx Life Sciences 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 CannBioRx Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CannBioRx Life Sciences has no effect on the direction of HUMANA i.e., HUMANA and CannBioRx Life go up and down completely randomly.
Pair Corralation between HUMANA and CannBioRx Life
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the CannBioRx Life. But the bond apears to be less risky and, when comparing its historical volatility, HUMANA INC is 10.54 times less risky than CannBioRx Life. The bond trades about -0.18 of its potential returns per unit of risk. The CannBioRx Life Sciences is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1.00 in CannBioRx Life Sciences on September 2, 2024 and sell it today you would lose (0.16) from holding CannBioRx Life Sciences or give up 16.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
HUMANA INC vs. CannBioRx Life Sciences
Performance |
| Timeline |
| HUMANA INC |
| CannBioRx Life Sciences |
HUMANA and CannBioRx Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and CannBioRx Life
The main advantage of trading using opposite HUMANA and CannBioRx Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, CannBioRx Life 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 CannBioRx Life will offset losses from the drop in CannBioRx Life's long position.The idea behind HUMANA INC and CannBioRx Life Sciences 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.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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