Correlation Between HUMANA and Itochu Corp
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By analyzing existing cross correlation between HUMANA INC and Itochu Corp ADR, you can compare the effects of market volatilities on HUMANA and Itochu Corp 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 Itochu Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Itochu Corp.
Diversification Opportunities for HUMANA and Itochu Corp
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between HUMANA and Itochu is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Itochu Corp ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Itochu Corp ADR 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 Itochu Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Itochu Corp ADR has no effect on the direction of HUMANA i.e., HUMANA and Itochu Corp go up and down completely randomly.
Pair Corralation between HUMANA and Itochu Corp
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Itochu Corp. But the bond apears to be less risky and, when comparing its historical volatility, HUMANA INC is 2.21 times less risky than Itochu Corp. The bond trades about -0.05 of its potential returns per unit of risk. The Itochu Corp ADR is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 9,969 in Itochu Corp ADR on September 4, 2024 and sell it today you would lose (73.00) from holding Itochu Corp ADR or give up 0.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
HUMANA INC vs. Itochu Corp ADR
Performance |
| Timeline |
| HUMANA INC |
| Itochu Corp ADR |
HUMANA and Itochu Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Itochu Corp
The main advantage of trading using opposite HUMANA and Itochu Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Itochu Corp 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 Itochu Corp will offset losses from the drop in Itochu Corp's long position.| HUMANA vs. Usio Inc | HUMANA vs. MACOM Technology Solutions | HUMANA vs. Amkor Technology | HUMANA vs. Analog Devices |
| Itochu Corp vs. Marubeni Corp ADR | Itochu Corp vs. Sumitomo Corp ADR | Itochu Corp vs. Mitsubishi Corp | Itochu Corp vs. Hitachi 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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