Correlation Between HUMANA and NV Gold
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By analyzing existing cross correlation between HUMANA INC and NV Gold, you can compare the effects of market volatilities on HUMANA and NV Gold 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 NV Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and NV Gold.
Diversification Opportunities for HUMANA and NV Gold
Average diversification
The 3 months correlation between HUMANA and NVGLF is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and NV Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NV Gold 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 NV Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NV Gold has no effect on the direction of HUMANA i.e., HUMANA and NV Gold go up and down completely randomly.
Pair Corralation between HUMANA and NV Gold
Assuming the 90 days trading horizon HUMANA INC is expected to generate 0.15 times more return on investment than NV Gold. However, HUMANA INC is 6.9 times less risky than NV Gold. It trades about -0.19 of its potential returns per unit of risk. NV Gold is currently generating about -0.15 per unit of risk. If you would invest 8,064 in HUMANA INC on September 12, 2024 and sell it today you would lose (369.00) from holding HUMANA INC or give up 4.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HUMANA INC vs. NV Gold
Performance |
| Timeline |
| HUMANA INC |
| NV Gold |
HUMANA and NV Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and NV Gold
The main advantage of trading using opposite HUMANA and NV Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, NV Gold 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 NV Gold will offset losses from the drop in NV Gold's long position.The idea behind HUMANA INC and NV Gold 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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