Correlation Between HUMANA and Nova Leap
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By analyzing existing cross correlation between HUMANA INC and Nova Leap Health, you can compare the effects of market volatilities on HUMANA and Nova Leap 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 Nova Leap. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Nova Leap.
Diversification Opportunities for HUMANA and Nova Leap
Very good diversification
The 3 months correlation between HUMANA and Nova is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Nova Leap Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nova Leap Health 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 Nova Leap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nova Leap Health has no effect on the direction of HUMANA i.e., HUMANA and Nova Leap go up and down completely randomly.
Pair Corralation between HUMANA and Nova Leap
Assuming the 90 days trading horizon HUMANA is expected to generate 59.43 times less return on investment than Nova Leap. But when comparing it to its historical volatility, HUMANA INC is 21.18 times less risky than Nova Leap. It trades about 0.02 of its potential returns per unit of risk. Nova Leap Health is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 16.00 in Nova Leap Health on August 25, 2024 and sell it today you would earn a total of 2.00 from holding Nova Leap Health or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.37% |
| Values | Daily Returns |
HUMANA INC vs. Nova Leap Health
Performance |
| Timeline |
| HUMANA INC |
| Nova Leap Health |
HUMANA and Nova Leap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Nova Leap
The main advantage of trading using opposite HUMANA and Nova Leap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Nova Leap 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 Nova Leap will offset losses from the drop in Nova Leap's long position.| HUMANA vs. Deluxe | HUMANA vs. Vita Coco | HUMANA vs. Willamette Valley Vineyards | HUMANA vs. Global E Online |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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