Correlation Between HUMANA and Blackrock Muniholdings
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By analyzing existing cross correlation between HUMANA INC and Blackrock Muniholdings Ca, you can compare the effects of market volatilities on HUMANA and Blackrock Muniholdings 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 Blackrock Muniholdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Blackrock Muniholdings.
Diversification Opportunities for HUMANA and Blackrock Muniholdings
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between HUMANA and Blackrock is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Blackrock Muniholdings Ca in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Muniholdings 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 Blackrock Muniholdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Muniholdings has no effect on the direction of HUMANA i.e., HUMANA and Blackrock Muniholdings go up and down completely randomly.
Pair Corralation between HUMANA and Blackrock Muniholdings
Assuming the 90 days trading horizon HUMANA INC is expected to generate 131.52 times more return on investment than Blackrock Muniholdings. However, HUMANA is 131.52 times more volatile than Blackrock Muniholdings Ca. It trades about 0.07 of its potential returns per unit of risk. Blackrock Muniholdings Ca is currently generating about 0.05 per unit of risk. If you would invest 8,012 in HUMANA INC on September 2, 2024 and sell it today you would lose (317.00) from holding HUMANA INC or give up 3.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 93.95% |
| Values | Daily Returns |
HUMANA INC vs. Blackrock Muniholdings Ca
Performance |
| Timeline |
| HUMANA INC |
| Blackrock Muniholdings |
HUMANA and Blackrock Muniholdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Blackrock Muniholdings
The main advantage of trading using opposite HUMANA and Blackrock Muniholdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Blackrock Muniholdings 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 Blackrock Muniholdings will offset losses from the drop in Blackrock Muniholdings' long position.The idea behind HUMANA INC and Blackrock Muniholdings Ca 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.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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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