Correlation Between HUMANA and Midwest Energy
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By analyzing existing cross correlation between HUMANA INC and Midwest Energy Emiss, you can compare the effects of market volatilities on HUMANA and Midwest Energy 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 Midwest Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Midwest Energy.
Diversification Opportunities for HUMANA and Midwest Energy
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HUMANA and Midwest is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Midwest Energy Emiss in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Midwest Energy Emiss 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 Midwest Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Midwest Energy Emiss has no effect on the direction of HUMANA i.e., HUMANA and Midwest Energy go up and down completely randomly.
Pair Corralation between HUMANA and Midwest Energy
Assuming the 90 days trading horizon HUMANA INC is expected to generate 0.2 times more return on investment than Midwest Energy. However, HUMANA INC is 5.0 times less risky than Midwest Energy. It trades about 0.02 of its potential returns per unit of risk. Midwest Energy Emiss is currently generating about -0.03 per unit of risk. If you would invest 7,900 in HUMANA INC on September 3, 2024 and sell it today you would earn a total of 135.00 from holding HUMANA INC or generate 1.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.95% |
| Values | Daily Returns |
HUMANA INC vs. Midwest Energy Emiss
Performance |
| Timeline |
| HUMANA INC |
| Midwest Energy Emiss |
HUMANA and Midwest Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Midwest Energy
The main advantage of trading using opposite HUMANA and Midwest Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Midwest Energy 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 Midwest Energy will offset losses from the drop in Midwest Energy's long position.| HUMANA vs. JetBlue Airways Corp | HUMANA vs. Air Transport Services | HUMANA vs. Sun Life Financial | HUMANA vs. Bank of America |
| Midwest Energy vs. TOMI Environmental Solutions | Midwest Energy vs. SCOR PK | Midwest Energy vs. HUMANA INC | Midwest Energy vs. Aquagold International |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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