Correlation Between HUMANA and A1
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By analyzing existing cross correlation between HUMANA INC and A1 Group, you can compare the effects of market volatilities on HUMANA and A1 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 A1. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and A1.
Diversification Opportunities for HUMANA and A1
Poor diversification
The 3 months correlation between HUMANA and A1 is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and A1 Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A1 Group 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 A1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A1 Group has no effect on the direction of HUMANA i.e., HUMANA and A1 go up and down completely randomly.
Pair Corralation between HUMANA and A1
Assuming the 90 days trading horizon HUMANA INC is expected to generate 4.84 times more return on investment than A1. However, HUMANA is 4.84 times more volatile than A1 Group. It trades about 0.07 of its potential returns per unit of risk. A1 Group is currently generating about 0.06 per unit of risk. If you would invest 8,030 in HUMANA INC on August 27, 2024 and sell it today you would earn a total of 5.00 from holding HUMANA INC or generate 0.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 93.75% |
| Values | Daily Returns |
HUMANA INC vs. A1 Group
Performance |
| Timeline |
| HUMANA INC |
| A1 Group |
HUMANA and A1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and A1
The main advantage of trading using opposite HUMANA and A1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, A1 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 A1 will offset losses from the drop in A1's long position.| HUMANA vs. Ultra Clean Holdings | HUMANA vs. Dream Homes Development | HUMANA vs. JBG SMITH Properties | HUMANA vs. Allegheny Technologies Incorporated |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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