Correlation Between HUMANA and Mfs Prudent
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By analyzing existing cross correlation between HUMANA INC and Mfs Prudent Investor, you can compare the effects of market volatilities on HUMANA and Mfs Prudent 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 Mfs Prudent. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Mfs Prudent.
Diversification Opportunities for HUMANA and Mfs Prudent
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between HUMANA and Mfs is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Mfs Prudent Investor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Prudent Investor 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 Mfs Prudent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Prudent Investor has no effect on the direction of HUMANA i.e., HUMANA and Mfs Prudent go up and down completely randomly.
Pair Corralation between HUMANA and Mfs Prudent
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Mfs Prudent. In addition to that, HUMANA is 1.58 times more volatile than Mfs Prudent Investor. It trades about -0.07 of its total potential returns per unit of risk. Mfs Prudent Investor is currently generating about -0.08 per unit of volatility. If you would invest 1,204 in Mfs Prudent Investor on August 29, 2024 and sell it today you would lose (9.00) from holding Mfs Prudent Investor or give up 0.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
HUMANA INC vs. Mfs Prudent Investor
Performance |
| Timeline |
| HUMANA INC |
| Mfs Prudent Investor |
HUMANA and Mfs Prudent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Mfs Prudent
The main advantage of trading using opposite HUMANA and Mfs Prudent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Mfs Prudent 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 Mfs Prudent will offset losses from the drop in Mfs Prudent's long position.The idea behind HUMANA INC and Mfs Prudent Investor 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.| Mfs Prudent vs. American Balanced Fund | Mfs Prudent vs. American Balanced Fund | Mfs Prudent vs. HUMANA INC | Mfs Prudent vs. Aquagold International |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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