Correlation Between HUMANA and PowerUp Acquisition
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By analyzing existing cross correlation between HUMANA INC and PowerUp Acquisition Corp, you can compare the effects of market volatilities on HUMANA and PowerUp Acquisition 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 PowerUp Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and PowerUp Acquisition.
Diversification Opportunities for HUMANA and PowerUp Acquisition
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HUMANA and PowerUp is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and PowerUp Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PowerUp Acquisition 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 PowerUp Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PowerUp Acquisition Corp has no effect on the direction of HUMANA i.e., HUMANA and PowerUp Acquisition go up and down completely randomly.
Pair Corralation between HUMANA and PowerUp Acquisition
Assuming the 90 days trading horizon HUMANA INC is expected to generate 0.52 times more return on investment than PowerUp Acquisition. However, HUMANA INC is 1.91 times less risky than PowerUp Acquisition. It trades about -0.07 of its potential returns per unit of risk. PowerUp Acquisition Corp is currently generating about -0.06 per unit of risk. If you would invest 8,111 in HUMANA INC on August 29, 2024 and sell it today you would lose (76.00) from holding HUMANA INC or give up 0.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
HUMANA INC vs. PowerUp Acquisition Corp
Performance |
| Timeline |
| HUMANA INC |
| PowerUp Acquisition Corp |
HUMANA and PowerUp Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and PowerUp Acquisition
The main advantage of trading using opposite HUMANA and PowerUp Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, PowerUp Acquisition 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 PowerUp Acquisition will offset losses from the drop in PowerUp Acquisition's long position.The idea behind HUMANA INC and PowerUp Acquisition 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.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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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