Correlation Between HUMANA and Pace Municipal
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By analyzing existing cross correlation between HUMANA INC and Pace Municipal Fixed, you can compare the effects of market volatilities on HUMANA and Pace Municipal 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 Pace Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Pace Municipal.
Diversification Opportunities for HUMANA and Pace Municipal
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HUMANA and Pace is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Pace Municipal Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pace Municipal Fixed 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 Pace Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pace Municipal Fixed has no effect on the direction of HUMANA i.e., HUMANA and Pace Municipal go up and down completely randomly.
Pair Corralation between HUMANA and Pace Municipal
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Pace Municipal. In addition to that, HUMANA is 5.36 times more volatile than Pace Municipal Fixed. It trades about -0.1 of its total potential returns per unit of risk. Pace Municipal Fixed is currently generating about 0.25 per unit of volatility. If you would invest 1,213 in Pace Municipal Fixed on November 29, 2024 and sell it today you would earn a total of 11.00 from holding Pace Municipal Fixed or generate 0.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
HUMANA INC vs. Pace Municipal Fixed
Performance |
| Timeline |
| HUMANA INC |
| Pace Municipal Fixed |
HUMANA and Pace Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Pace Municipal
The main advantage of trading using opposite HUMANA and Pace Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Pace Municipal 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 Pace Municipal will offset losses from the drop in Pace Municipal's long position.| HUMANA vs. SNDL Inc | HUMANA vs. Compania Cervecerias Unidas | HUMANA vs. Monster Beverage Corp | HUMANA vs. Keurig Dr Pepper |
| Pace Municipal vs. Us Government Securities | Pace Municipal vs. Access Capital Munity | Pace Municipal vs. Virtus Seix Government | Pace Municipal vs. Inverse Government Long |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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