Correlation Between HUMANA and Goldman Sachs
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By analyzing existing cross correlation between HUMANA INC and Goldman Sachs MarketBeta, you can compare the effects of market volatilities on HUMANA and Goldman Sachs 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 Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Goldman Sachs.
Diversification Opportunities for HUMANA and Goldman Sachs
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between HUMANA and Goldman is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Goldman Sachs MarketBeta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs MarketBeta 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 Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs MarketBeta has no effect on the direction of HUMANA i.e., HUMANA and Goldman Sachs go up and down completely randomly.
Pair Corralation between HUMANA and Goldman Sachs
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Goldman Sachs. In addition to that, HUMANA is 1.14 times more volatile than Goldman Sachs MarketBeta. It trades about -0.18 of its total potential returns per unit of risk. Goldman Sachs MarketBeta is currently generating about -0.11 per unit of volatility. If you would invest 4,672 in Goldman Sachs MarketBeta on September 2, 2024 and sell it today you would lose (118.00) from holding Goldman Sachs MarketBeta or give up 2.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
HUMANA INC vs. Goldman Sachs MarketBeta
Performance |
| Timeline |
| HUMANA INC |
| Goldman Sachs MarketBeta |
HUMANA and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Goldman Sachs
The main advantage of trading using opposite HUMANA and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.The idea behind HUMANA INC and Goldman Sachs MarketBeta 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.| Goldman Sachs vs. FT Vest Equity | Goldman Sachs vs. Northern Lights | Goldman Sachs vs. Dimensional International High | Goldman Sachs vs. Matthews China Discovery |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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