Correlation Between HUMANA and SSC Security
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By analyzing existing cross correlation between HUMANA INC and SSC Security Services, you can compare the effects of market volatilities on HUMANA and SSC Security 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 SSC Security. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and SSC Security.
Diversification Opportunities for HUMANA and SSC Security
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HUMANA and SSC is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and SSC Security Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSC Security Services 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 SSC Security. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSC Security Services has no effect on the direction of HUMANA i.e., HUMANA and SSC Security go up and down completely randomly.
Pair Corralation between HUMANA and SSC Security
Assuming the 90 days trading horizon HUMANA INC is expected to generate 21.07 times more return on investment than SSC Security. However, HUMANA is 21.07 times more volatile than SSC Security Services. It trades about 0.07 of its potential returns per unit of risk. SSC Security Services is currently generating about 0.02 per unit of risk. If you would invest 8,012 in HUMANA INC on September 2, 2024 and sell it today you would lose (317.00) from holding HUMANA INC or give up 3.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.95% |
| Values | Daily Returns |
HUMANA INC vs. SSC Security Services
Performance |
| Timeline |
| HUMANA INC |
| SSC Security Services |
HUMANA and SSC Security Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and SSC Security
The main advantage of trading using opposite HUMANA and SSC Security positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, SSC Security 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 SSC Security will offset losses from the drop in SSC Security's long position.The idea behind HUMANA INC and SSC Security Services 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.| SSC Security vs. Allegion PLC | SSC Security vs. MSA Safety | SSC Security vs. HUMANA INC | SSC Security 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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