Correlation Between HUMANA and Causeway International
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By analyzing existing cross correlation between HUMANA INC and Causeway International Value, you can compare the effects of market volatilities on HUMANA and Causeway International 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 Causeway International. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Causeway International.
Diversification Opportunities for HUMANA and Causeway International
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HUMANA and Causeway is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Causeway International Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Causeway International 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 Causeway International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Causeway International has no effect on the direction of HUMANA i.e., HUMANA and Causeway International go up and down completely randomly.
Pair Corralation between HUMANA and Causeway International
Assuming the 90 days trading horizon HUMANA INC is expected to generate 0.8 times more return on investment than Causeway International. However, HUMANA INC is 1.25 times less risky than Causeway International. It trades about -0.07 of its potential returns per unit of risk. Causeway International Value is currently generating about -0.27 per unit of risk. If you would invest 8,111 in HUMANA INC on August 29, 2024 and sell it today you would lose (76.00) from holding HUMANA INC or give up 0.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 86.96% |
| Values | Daily Returns |
HUMANA INC vs. Causeway International Value
Performance |
| Timeline |
| HUMANA INC |
| Causeway International |
HUMANA and Causeway International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Causeway International
The main advantage of trading using opposite HUMANA and Causeway International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Causeway International 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 Causeway International will offset losses from the drop in Causeway International's long position.The idea behind HUMANA INC and Causeway International Value 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.| Causeway International vs. HUMANA INC | Causeway International vs. Aquagold International | Causeway International vs. Barloworld Ltd ADR | Causeway International vs. Morningstar Unconstrained Allocation |
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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