Correlation Between HUMANA and Franklin Colorado
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By analyzing existing cross correlation between HUMANA INC and Franklin Orado Tax Free, you can compare the effects of market volatilities on HUMANA and Franklin Colorado 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 Colorado. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Franklin Colorado.
Diversification Opportunities for HUMANA and Franklin Colorado
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HUMANA and Franklin is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Franklin Orado Tax Free in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Orado Tax 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 Colorado. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Orado Tax has no effect on the direction of HUMANA i.e., HUMANA and Franklin Colorado go up and down completely randomly.
Pair Corralation between HUMANA and Franklin Colorado
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Franklin Colorado. In addition to that, HUMANA is 3.94 times more volatile than Franklin Orado Tax Free. It trades about -0.22 of its total potential returns per unit of risk. Franklin Orado Tax Free is currently generating about 0.24 per unit of volatility. If you would invest 1,050 in Franklin Orado Tax Free on August 30, 2024 and sell it today you would earn a total of 16.00 from holding Franklin Orado Tax Free or generate 1.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
HUMANA INC vs. Franklin Orado Tax Free
Performance |
| Timeline |
| HUMANA INC |
| Franklin Orado Tax |
HUMANA and Franklin Colorado Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Franklin Colorado
The main advantage of trading using opposite HUMANA and Franklin Colorado positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Franklin Colorado 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 Colorado will offset losses from the drop in Franklin Colorado's long position.The idea behind HUMANA INC and Franklin Orado Tax Free 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.| Franklin Colorado vs. Maryland Tax Free Bond | Franklin Colorado vs. HUMANA INC | Franklin Colorado vs. Aquagold International | Franklin Colorado vs. Barloworld Ltd ADR |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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