Correlation Between HUMANA and First Trust
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By analyzing existing cross correlation between HUMANA INC and First Trust NASDAQ 100, you can compare the effects of market volatilities on HUMANA and First Trust 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 First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and First Trust.
Diversification Opportunities for HUMANA and First Trust
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between HUMANA and First is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and First Trust NASDAQ 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust NASDAQ 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 First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust NASDAQ has no effect on the direction of HUMANA i.e., HUMANA and First Trust go up and down completely randomly.
Pair Corralation between HUMANA and First Trust
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the First Trust. In addition to that, HUMANA is 1.38 times more volatile than First Trust NASDAQ 100. It trades about -0.22 of its total potential returns per unit of risk. First Trust NASDAQ 100 is currently generating about 0.28 per unit of volatility. If you would invest 9,363 in First Trust NASDAQ 100 on August 29, 2024 and sell it today you would earn a total of 470.00 from holding First Trust NASDAQ 100 or generate 5.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
HUMANA INC vs. First Trust NASDAQ 100
Performance |
| Timeline |
| HUMANA INC |
| First Trust NASDAQ |
HUMANA and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and First Trust
The main advantage of trading using opposite HUMANA and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| HUMANA vs. Zhihu Inc ADR | HUMANA vs. National CineMedia | HUMANA vs. Comstock Holding Companies | HUMANA vs. PennantPark Investment |
| First Trust vs. Invesco Dynamic Large | First Trust vs. Perella Weinberg Partners | First Trust vs. HUMANA INC | First Trust vs. Aquagold International |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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