Correlation Between HUMANA and Rational Defensive
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By analyzing existing cross correlation between HUMANA INC and Rational Defensive Growth, you can compare the effects of market volatilities on HUMANA and Rational Defensive 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 Rational Defensive. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Rational Defensive.
Diversification Opportunities for HUMANA and Rational Defensive
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HUMANA and Rational is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Rational Defensive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rational Defensive Growth 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 Rational Defensive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rational Defensive Growth has no effect on the direction of HUMANA i.e., HUMANA and Rational Defensive go up and down completely randomly.
Pair Corralation between HUMANA and Rational Defensive
Assuming the 90 days trading horizon HUMANA INC is expected to generate 1.13 times more return on investment than Rational Defensive. However, HUMANA is 1.13 times more volatile than Rational Defensive Growth. It trades about -0.09 of its potential returns per unit of risk. Rational Defensive Growth is currently generating about -0.26 per unit of risk. If you would invest 8,052 in HUMANA INC on November 27, 2024 and sell it today you would lose (153.00) from holding HUMANA INC or give up 1.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
HUMANA INC vs. Rational Defensive Growth
Performance |
| Timeline |
| HUMANA INC |
| Rational Defensive Growth |
HUMANA and Rational Defensive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Rational Defensive
The main advantage of trading using opposite HUMANA and Rational Defensive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Rational Defensive 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 Rational Defensive will offset losses from the drop in Rational Defensive's long position.| HUMANA vs. Amkor Technology | HUMANA vs. Primo Brands | HUMANA vs. The Coca Cola | HUMANA vs. Brandywine Realty Trust |
| Rational Defensive vs. Metropolitan West High | Rational Defensive vs. Barings High Yield | Rational Defensive vs. Prudential High Yield | Rational Defensive vs. Intal High Relative |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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