Correlation Between HUMANA and Mars Acquisition
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By analyzing existing cross correlation between HUMANA INC and Mars Acquisition Corp, you can compare the effects of market volatilities on HUMANA and Mars Acquisition 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 Mars Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Mars Acquisition.
Diversification Opportunities for HUMANA and Mars Acquisition
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HUMANA and Mars is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Mars Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mars Acquisition Corp 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 Mars Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mars Acquisition Corp has no effect on the direction of HUMANA i.e., HUMANA and Mars Acquisition go up and down completely randomly.
Pair Corralation between HUMANA and Mars Acquisition
Assuming the 90 days trading horizon HUMANA is expected to generate 462.0 times less return on investment than Mars Acquisition. But when comparing it to its historical volatility, HUMANA INC is 16.58 times less risky than Mars Acquisition. It trades about 0.0 of its potential returns per unit of risk. Mars Acquisition Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 21.00 in Mars Acquisition Corp on September 12, 2024 and sell it today you would earn a total of 15.00 from holding Mars Acquisition Corp or generate 71.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 47.68% |
| Values | Daily Returns |
HUMANA INC vs. Mars Acquisition Corp
Performance |
| Timeline |
| HUMANA INC |
| Mars Acquisition Corp |
HUMANA and Mars Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Mars Acquisition
The main advantage of trading using opposite HUMANA and Mars Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Mars Acquisition 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 Mars Acquisition will offset losses from the drop in Mars Acquisition's long position.The idea behind HUMANA INC and Mars Acquisition Corp 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.| Mars Acquisition vs. HUMANA INC | Mars Acquisition vs. Barloworld Ltd ADR | Mars Acquisition vs. Morningstar Unconstrained Allocation | Mars Acquisition vs. Thrivent High Yield |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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