Correlation Between HUMANA and Templeton Emerging
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By analyzing existing cross correlation between HUMANA INC and Templeton Emerging Markets, you can compare the effects of market volatilities on HUMANA and Templeton Emerging 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 Templeton Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Templeton Emerging.
Diversification Opportunities for HUMANA and Templeton Emerging
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between HUMANA and Templeton is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Templeton Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Emerging 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 Templeton Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Emerging has no effect on the direction of HUMANA i.e., HUMANA and Templeton Emerging go up and down completely randomly.
Pair Corralation between HUMANA and Templeton Emerging
Assuming the 90 days trading horizon HUMANA INC is expected to generate 65.95 times more return on investment than Templeton Emerging. However, HUMANA is 65.95 times more volatile than Templeton Emerging Markets. It trades about 0.07 of its potential returns per unit of risk. Templeton Emerging Markets is currently generating about 0.06 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 Together |
| Strength | Very Weak |
| Accuracy | 93.95% |
| Values | Daily Returns |
HUMANA INC vs. Templeton Emerging Markets
Performance |
| Timeline |
| HUMANA INC |
| Templeton Emerging |
HUMANA and Templeton Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Templeton Emerging
The main advantage of trading using opposite HUMANA and Templeton Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Templeton Emerging 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 Templeton Emerging will offset losses from the drop in Templeton Emerging's long position.The idea behind HUMANA INC and Templeton Emerging Markets 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.| Templeton Emerging vs. Franklin Templeton Limited | Templeton Emerging vs. Western Asset Global | Templeton Emerging vs. MFS Multimarket Income | Templeton Emerging vs. Aberdeen Asia Pacific If |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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