Correlation Between HUMANA and Advent Claymore
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By analyzing existing cross correlation between HUMANA INC and Advent Claymore Convertible, you can compare the effects of market volatilities on HUMANA and Advent Claymore 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 Advent Claymore. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Advent Claymore.
Diversification Opportunities for HUMANA and Advent Claymore
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between HUMANA and Advent is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Advent Claymore Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advent Claymore Conv 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 Advent Claymore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advent Claymore Conv has no effect on the direction of HUMANA i.e., HUMANA and Advent Claymore go up and down completely randomly.
Pair Corralation between HUMANA and Advent Claymore
Assuming the 90 days trading horizon HUMANA INC is expected to generate 77.14 times more return on investment than Advent Claymore. However, HUMANA is 77.14 times more volatile than Advent Claymore Convertible. It trades about 0.07 of its potential returns per unit of risk. Advent Claymore Convertible is currently generating about 0.07 per unit of risk. If you would invest 8,012 in HUMANA INC on September 2, 2024 and sell it today you would lose (317.00) from holding HUMANA INC or give up 3.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.95% |
| Values | Daily Returns |
HUMANA INC vs. Advent Claymore Convertible
Performance |
| Timeline |
| HUMANA INC |
| Advent Claymore Conv |
HUMANA and Advent Claymore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Advent Claymore
The main advantage of trading using opposite HUMANA and Advent Claymore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Advent Claymore 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 Advent Claymore will offset losses from the drop in Advent Claymore's long position.The idea behind HUMANA INC and Advent Claymore Convertible 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.| Advent Claymore vs. Nuveen Global High | Advent Claymore vs. Blackstone Gso Strategic | Advent Claymore vs. Thornburg Income Builder | Advent Claymore vs. Western Asset Diversified |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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