Correlation Between HUMANA and NetEase
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By analyzing existing cross correlation between HUMANA INC and NetEase, you can compare the effects of market volatilities on HUMANA and NetEase 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 NetEase. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and NetEase.
Diversification Opportunities for HUMANA and NetEase
Good diversification
The 3 months correlation between HUMANA and NetEase is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and NetEase in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NetEase 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 NetEase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NetEase has no effect on the direction of HUMANA i.e., HUMANA and NetEase go up and down completely randomly.
Pair Corralation between HUMANA and NetEase
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the NetEase. But the bond apears to be less risky and, when comparing its historical volatility, HUMANA INC is 2.65 times less risky than NetEase. The bond trades about -0.21 of its potential returns per unit of risk. The NetEase is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 8,051 in NetEase on September 1, 2024 and sell it today you would earn a total of 697.00 from holding NetEase or generate 8.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
HUMANA INC vs. NetEase
Performance |
| Timeline |
| HUMANA INC |
| NetEase |
HUMANA and NetEase Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and NetEase
The main advantage of trading using opposite HUMANA and NetEase positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, NetEase 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 NetEase will offset losses from the drop in NetEase's long position.| HUMANA vs. NI Holdings | HUMANA vs. Naked Wines plc | HUMANA vs. Kinsale Capital Group | HUMANA vs. Diageo PLC ADR |
| NetEase vs. Roblox Corp | NetEase vs. Skillz Platform | NetEase vs. Take Two Interactive Software | NetEase vs. Nintendo Co 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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