Correlation Between HUMANA and Franklin Lifesmart
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By analyzing existing cross correlation between HUMANA INC and Franklin Lifesmart 2040, you can compare the effects of market volatilities on HUMANA and Franklin Lifesmart 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 Franklin Lifesmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Franklin Lifesmart.
Diversification Opportunities for HUMANA and Franklin Lifesmart
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HUMANA and Franklin is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Franklin Lifesmart 2040 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Lifesmart 2040 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 Franklin Lifesmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Lifesmart 2040 has no effect on the direction of HUMANA i.e., HUMANA and Franklin Lifesmart go up and down completely randomly.
Pair Corralation between HUMANA and Franklin Lifesmart
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Franklin Lifesmart. In addition to that, HUMANA is 1.02 times more volatile than Franklin Lifesmart 2040. It trades about -0.03 of its total potential returns per unit of risk. Franklin Lifesmart 2040 is currently generating about 0.09 per unit of volatility. If you would invest 1,366 in Franklin Lifesmart 2040 on September 1, 2024 and sell it today you would earn a total of 147.00 from holding Franklin Lifesmart 2040 or generate 10.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.35% |
| Values | Daily Returns |
HUMANA INC vs. Franklin Lifesmart 2040
Performance |
| Timeline |
| HUMANA INC |
| Franklin Lifesmart 2040 |
HUMANA and Franklin Lifesmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Franklin Lifesmart
The main advantage of trading using opposite HUMANA and Franklin Lifesmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Franklin Lifesmart 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 Franklin Lifesmart will offset losses from the drop in Franklin Lifesmart's long position.| HUMANA vs. NI Holdings | HUMANA vs. Naked Wines plc | HUMANA vs. Kinsale Capital Group | HUMANA vs. Diageo PLC ADR |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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