Correlation Between HUMANA and Transportation Fund
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By analyzing existing cross correlation between HUMANA INC and Transportation Fund Investor, you can compare the effects of market volatilities on HUMANA and Transportation Fund 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 Transportation Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Transportation Fund.
Diversification Opportunities for HUMANA and Transportation Fund
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HUMANA and Transportation is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Transportation Fund Investor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transportation Fund 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 Transportation Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transportation Fund has no effect on the direction of HUMANA i.e., HUMANA and Transportation Fund go up and down completely randomly.
Pair Corralation between HUMANA and Transportation Fund
Assuming the 90 days trading horizon HUMANA INC is expected to generate 58.54 times more return on investment than Transportation Fund. However, HUMANA is 58.54 times more volatile than Transportation Fund Investor. It trades about 0.07 of its potential returns per unit of risk. Transportation Fund Investor is currently generating about 0.02 per unit of risk. If you would invest 8,028 in HUMANA INC on August 30, 2024 and sell it today you would lose (333.00) from holding HUMANA INC or give up 4.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 93.74% |
| Values | Daily Returns |
HUMANA INC vs. Transportation Fund Investor
Performance |
| Timeline |
| HUMANA INC |
| Transportation Fund |
HUMANA and Transportation Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Transportation Fund
The main advantage of trading using opposite HUMANA and Transportation Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Transportation Fund 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 Transportation Fund will offset losses from the drop in Transportation Fund's long position.The idea behind HUMANA INC and Transportation Fund Investor 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.| Transportation Fund vs. T Rowe Price | Transportation Fund vs. T Rowe Price | Transportation Fund vs. T Rowe Price | Transportation Fund vs. HUMANA INC |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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