Correlation Between HUMANA and American Beacon
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By analyzing existing cross correlation between HUMANA INC and American Beacon Funds, you can compare the effects of market volatilities on HUMANA and American Beacon 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 American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and American Beacon.
Diversification Opportunities for HUMANA and American Beacon
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HUMANA and American is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and American Beacon Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Funds 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 American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Funds has no effect on the direction of HUMANA i.e., HUMANA and American Beacon go up and down completely randomly.
Pair Corralation between HUMANA and American Beacon
Assuming the 90 days trading horizon HUMANA INC is expected to under-perform the American Beacon. In addition to that, HUMANA is 4.72 times more volatile than American Beacon Funds. It trades about -0.04 of its total potential returns per unit of risk. American Beacon Funds is currently generating about 0.25 per unit of volatility. If you would invest 820.00 in American Beacon Funds on September 1, 2024 and sell it today you would earn a total of 38.00 from holding American Beacon Funds or generate 4.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
HUMANA INC vs. American Beacon Funds
Performance |
| Timeline |
| HUMANA INC |
| American Beacon Funds |
HUMANA and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and American Beacon
The main advantage of trading using opposite HUMANA and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| HUMANA vs. NI Holdings | HUMANA vs. Naked Wines plc | HUMANA vs. Kinsale Capital Group | HUMANA vs. Diageo PLC ADR |
| American Beacon vs. Federated Institutional High | American Beacon vs. Pace High Yield | American Beacon vs. Dunham High Yield | American Beacon vs. Valic Company I |
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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