Correlation Between HUMANA and Gmo Asset
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By analyzing existing cross correlation between HUMANA INC and Gmo Asset Allocation, you can compare the effects of market volatilities on HUMANA and Gmo Asset 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 Gmo Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Gmo Asset.
Diversification Opportunities for HUMANA and Gmo Asset
Poor diversification
The 3 months correlation between HUMANA and Gmo is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Gmo Asset Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Asset Allocation 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 Gmo Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Asset Allocation has no effect on the direction of HUMANA i.e., HUMANA and Gmo Asset go up and down completely randomly.
Pair Corralation between HUMANA and Gmo Asset
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Gmo Asset. But the bond apears to be less risky and, when comparing its historical volatility, HUMANA INC is 1.88 times less risky than Gmo Asset. The bond trades about 0.0 of its potential returns per unit of risk. The Gmo Asset Allocation is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,875 in Gmo Asset Allocation on August 30, 2024 and sell it today you would earn a total of 71.00 from holding Gmo Asset Allocation or generate 3.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.44% |
| Values | Daily Returns |
HUMANA INC vs. Gmo Asset Allocation
Performance |
| Timeline |
| HUMANA INC |
| Gmo Asset Allocation |
HUMANA and Gmo Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Gmo Asset
The main advantage of trading using opposite HUMANA and Gmo Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Gmo Asset 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 Gmo Asset will offset losses from the drop in Gmo Asset's long position.The idea behind HUMANA INC and Gmo Asset Allocation 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.| Gmo Asset vs. HUMANA INC | Gmo Asset vs. Aquagold International | Gmo Asset vs. Barloworld Ltd ADR | Gmo Asset 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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