Correlation Between HUMANA and Stet Tax-advantaged
Specify exactly 2 symbols:
By analyzing existing cross correlation between HUMANA INC and Stet Tax Advantaged Income, you can compare the effects of market volatilities on HUMANA and Stet Tax-advantaged 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 Stet Tax-advantaged. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Stet Tax-advantaged.
Diversification Opportunities for HUMANA and Stet Tax-advantaged
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between HUMANA and Stet is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Stet Tax Advantaged Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stet Tax Advantaged 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 Stet Tax-advantaged. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stet Tax Advantaged has no effect on the direction of HUMANA i.e., HUMANA and Stet Tax-advantaged go up and down completely randomly.
Pair Corralation between HUMANA and Stet Tax-advantaged
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the Stet Tax-advantaged. In addition to that, HUMANA is 5.02 times more volatile than Stet Tax Advantaged Income. It trades about -0.16 of its total potential returns per unit of risk. Stet Tax Advantaged Income is currently generating about 0.17 per unit of volatility. If you would invest 935.00 in Stet Tax Advantaged Income on September 1, 2024 and sell it today you would earn a total of 10.00 from holding Stet Tax Advantaged Income or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
HUMANA INC vs. Stet Tax Advantaged Income
Performance |
| Timeline |
| HUMANA INC |
| Stet Tax Advantaged |
HUMANA and Stet Tax-advantaged Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Stet Tax-advantaged
The main advantage of trading using opposite HUMANA and Stet Tax-advantaged positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Stet Tax-advantaged 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 Stet Tax-advantaged will offset losses from the drop in Stet Tax-advantaged's long position.| HUMANA vs. NI Holdings | HUMANA vs. Naked Wines plc | HUMANA vs. Kinsale Capital Group | HUMANA vs. Diageo PLC ADR |
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Stet Tax-advantaged as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Stet Tax-advantaged's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Stet Tax-advantaged's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Stet Tax Advantaged Income.
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |