Correlation Between HUMANA and Vanguard Wellesley
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By analyzing existing cross correlation between HUMANA INC and Vanguard Wellesley Income, you can compare the effects of market volatilities on HUMANA and Vanguard Wellesley 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 Vanguard Wellesley. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Vanguard Wellesley.
Diversification Opportunities for HUMANA and Vanguard Wellesley
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HUMANA and Vanguard is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Vanguard Wellesley Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Wellesley Income 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 Vanguard Wellesley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Wellesley Income has no effect on the direction of HUMANA i.e., HUMANA and Vanguard Wellesley go up and down completely randomly.
Pair Corralation between HUMANA and Vanguard Wellesley
Assuming the 90 days trading horizon HUMANA INC is expected to generate 1.33 times more return on investment than Vanguard Wellesley. However, HUMANA is 1.33 times more volatile than Vanguard Wellesley Income. It trades about 0.08 of its potential returns per unit of risk. Vanguard Wellesley Income is currently generating about -0.06 per unit of risk. If you would invest 8,111 in HUMANA INC on October 26, 2024 and sell it today you would earn a total of 333.00 from holding HUMANA INC or generate 4.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HUMANA INC vs. Vanguard Wellesley Income
Performance |
| Timeline |
| HUMANA INC |
| Vanguard Wellesley Income |
HUMANA and Vanguard Wellesley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Vanguard Wellesley
The main advantage of trading using opposite HUMANA and Vanguard Wellesley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Vanguard Wellesley 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 Vanguard Wellesley will offset losses from the drop in Vanguard Wellesley's long position.| HUMANA vs. MYT Netherlands Parent | HUMANA vs. Getty Realty | HUMANA vs. Olympic Steel | HUMANA vs. The Peoples Insurance |
| Vanguard Wellesley vs. Vanguard Wellington Fund | Vanguard Wellesley vs. Vanguard Balanced Index | Vanguard Wellesley vs. Vanguard Wellesley Income | Vanguard Wellesley vs. Vanguard Dividend Growth |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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