Correlation Between HUMANA and Cerrado Gold
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By analyzing existing cross correlation between HUMANA INC and Cerrado Gold, you can compare the effects of market volatilities on HUMANA and Cerrado Gold 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 Cerrado Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Cerrado Gold.
Diversification Opportunities for HUMANA and Cerrado Gold
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between HUMANA and Cerrado is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Cerrado Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cerrado Gold 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 Cerrado Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cerrado Gold has no effect on the direction of HUMANA i.e., HUMANA and Cerrado Gold go up and down completely randomly.
Pair Corralation between HUMANA and Cerrado Gold
Assuming the 90 days trading horizon HUMANA is expected to generate 4.27 times less return on investment than Cerrado Gold. But when comparing it to its historical volatility, HUMANA INC is 5.91 times less risky than Cerrado Gold. It trades about 0.27 of its potential returns per unit of risk. Cerrado Gold is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 24.00 in Cerrado Gold on October 21, 2024 and sell it today you would earn a total of 6.00 from holding Cerrado Gold or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
HUMANA INC vs. Cerrado Gold
Performance |
| Timeline |
| HUMANA INC |
| Cerrado Gold |
HUMANA and Cerrado Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Cerrado Gold
The main advantage of trading using opposite HUMANA and Cerrado Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Cerrado Gold 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 Cerrado Gold will offset losses from the drop in Cerrado Gold's long position.| HUMANA vs. Vantage Drilling International | HUMANA vs. Sable Offshore Corp | HUMANA vs. Noble plc | HUMANA vs. Drilling Tools International |
| Cerrado Gold vs. Antioquia Gold | Cerrado Gold vs. Red Pine Exploration | Cerrado Gold vs. Bellevue Gold Limited | Cerrado Gold vs. Asante Gold |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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