Correlation Between HUMANA and Citizens Financial
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By analyzing existing cross correlation between HUMANA INC and Citizens Financial Group, you can compare the effects of market volatilities on HUMANA and Citizens Financial 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 Citizens Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Citizens Financial.
Diversification Opportunities for HUMANA and Citizens Financial
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HUMANA and Citizens is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Citizens Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citizens Financial 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 Citizens Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citizens Financial has no effect on the direction of HUMANA i.e., HUMANA and Citizens Financial go up and down completely randomly.
Pair Corralation between HUMANA and Citizens Financial
Assuming the 90 days trading horizon HUMANA is expected to generate 24.92 times less return on investment than Citizens Financial. But when comparing it to its historical volatility, HUMANA INC is 1.72 times less risky than Citizens Financial. It trades about 0.01 of its potential returns per unit of risk. Citizens Financial Group is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,912 in Citizens Financial Group on September 3, 2024 and sell it today you would earn a total of 227.00 from holding Citizens Financial Group or generate 11.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.6% |
| Values | Daily Returns |
HUMANA INC vs. Citizens Financial Group
Performance |
| Timeline |
| HUMANA INC |
| Citizens Financial |
HUMANA and Citizens Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Citizens Financial
The main advantage of trading using opposite HUMANA and Citizens Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Citizens Financial 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 Citizens Financial will offset losses from the drop in Citizens Financial's long position.| HUMANA vs. JetBlue Airways Corp | HUMANA vs. Air Transport Services | HUMANA vs. Sun Life Financial | HUMANA vs. Bank of America |
| Citizens Financial vs. Capital One Financial | Citizens Financial vs. Bank of America | Citizens Financial vs. KeyCorp | Citizens Financial vs. HUMANA INC |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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