Correlation Between HUMANA and Barings BDC
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By analyzing existing cross correlation between HUMANA INC and Barings BDC, you can compare the effects of market volatilities on HUMANA and Barings BDC 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 Barings BDC. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Barings BDC.
Diversification Opportunities for HUMANA and Barings BDC
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HUMANA and Barings is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Barings BDC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings BDC 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 Barings BDC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings BDC has no effect on the direction of HUMANA i.e., HUMANA and Barings BDC go up and down completely randomly.
Pair Corralation between HUMANA and Barings BDC
Assuming the 90 days trading horizon HUMANA is expected to generate 3.26 times less return on investment than Barings BDC. In addition to that, HUMANA is 1.17 times more volatile than Barings BDC. It trades about 0.15 of its total potential returns per unit of risk. Barings BDC is currently generating about 0.58 per unit of volatility. If you would invest 937.00 in Barings BDC on November 9, 2024 and sell it today you would earn a total of 74.00 from holding Barings BDC or generate 7.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
HUMANA INC vs. Barings BDC
Performance |
| Timeline |
| HUMANA INC |
| Barings BDC |
HUMANA and Barings BDC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Barings BDC
The main advantage of trading using opposite HUMANA and Barings BDC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Barings BDC 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 Barings BDC will offset losses from the drop in Barings BDC's long position.The idea behind HUMANA INC and Barings BDC 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.| Barings BDC vs. Runway Growth Finance | Barings BDC vs. OneMain Holdings | Barings BDC vs. Navient Corp | Barings BDC vs. Oaktree Specialty Lending |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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