Correlation Between HUMANA and Nikon Corp
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By analyzing existing cross correlation between HUMANA INC and Nikon Corp, you can compare the effects of market volatilities on HUMANA and Nikon 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 Nikon Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Nikon Corp.
Diversification Opportunities for HUMANA and Nikon Corp
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HUMANA and Nikon is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Nikon Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nikon 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 Nikon Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nikon Corp has no effect on the direction of HUMANA i.e., HUMANA and Nikon Corp go up and down completely randomly.
Pair Corralation between HUMANA and Nikon Corp
Assuming the 90 days trading horizon HUMANA INC is expected to generate 0.3 times more return on investment than Nikon Corp. However, HUMANA INC is 3.35 times less risky than Nikon Corp. It trades about -0.05 of its potential returns per unit of risk. Nikon Corp is currently generating about -0.08 per unit of risk. If you would invest 8,090 in HUMANA INC on September 5, 2024 and sell it today you would lose (55.00) from holding HUMANA INC or give up 0.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 86.36% |
| Values | Daily Returns |
HUMANA INC vs. Nikon Corp
Performance |
| Timeline |
| HUMANA INC |
| Nikon Corp |
HUMANA and Nikon Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Nikon Corp
The main advantage of trading using opposite HUMANA and Nikon Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Nikon 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 Nikon Corp will offset losses from the drop in Nikon Corp's long position.The idea behind HUMANA INC and Nikon 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.| Nikon Corp vs. Yamaha Corp DRC | Nikon Corp vs. Planet Fitness | Nikon Corp vs. Plby Group | Nikon Corp vs. Shimano Inc 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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