Correlation Between HUMANA and SMC Entertainment
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By analyzing existing cross correlation between HUMANA INC and SMC Entertainment, you can compare the effects of market volatilities on HUMANA and SMC Entertainment 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 SMC Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and SMC Entertainment.
Diversification Opportunities for HUMANA and SMC Entertainment
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HUMANA and SMC is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and SMC Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMC Entertainment 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 SMC Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMC Entertainment has no effect on the direction of HUMANA i.e., HUMANA and SMC Entertainment go up and down completely randomly.
Pair Corralation between HUMANA and SMC Entertainment
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the SMC Entertainment. But the bond apears to be less risky and, when comparing its historical volatility, HUMANA INC is 23.77 times less risky than SMC Entertainment. The bond trades about -0.02 of its potential returns per unit of risk. The SMC Entertainment is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 0.08 in SMC Entertainment on September 2, 2024 and sell it today you would earn a total of 0.04 from holding SMC Entertainment or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.93% |
| Values | Daily Returns |
HUMANA INC vs. SMC Entertainment
Performance |
| Timeline |
| HUMANA INC |
| SMC Entertainment |
HUMANA and SMC Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and SMC Entertainment
The main advantage of trading using opposite HUMANA and SMC Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, SMC Entertainment 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 SMC Entertainment will offset losses from the drop in SMC Entertainment's long position.The idea behind HUMANA INC and SMC Entertainment 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.| SMC Entertainment vs. HUMANA INC | SMC Entertainment vs. Aquagold International | SMC Entertainment vs. Barloworld Ltd ADR | SMC Entertainment vs. Thrivent High Yield |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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