Correlation Between HUMANA and Teton Westwood
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By analyzing existing cross correlation between HUMANA INC and Teton Westwood Small, you can compare the effects of market volatilities on HUMANA and Teton Westwood 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 Teton Westwood. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Teton Westwood.
Diversification Opportunities for HUMANA and Teton Westwood
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HUMANA and Teton is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Teton Westwood Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teton Westwood Small 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 Teton Westwood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teton Westwood Small has no effect on the direction of HUMANA i.e., HUMANA and Teton Westwood go up and down completely randomly.
Pair Corralation between HUMANA and Teton Westwood
Assuming the 90 days trading horizon HUMANA INC is expected to generate 51.78 times more return on investment than Teton Westwood. However, HUMANA is 51.78 times more volatile than Teton Westwood Small. It trades about 0.07 of its potential returns per unit of risk. Teton Westwood Small is currently generating about 0.01 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 Against |
| Strength | Very Weak |
| Accuracy | 93.95% |
| Values | Daily Returns |
HUMANA INC vs. Teton Westwood Small
Performance |
| Timeline |
| HUMANA INC |
| Teton Westwood Small |
HUMANA and Teton Westwood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUMANA and Teton Westwood
The main advantage of trading using opposite HUMANA and Teton Westwood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Teton Westwood 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 Teton Westwood will offset losses from the drop in Teton Westwood's long position.The idea behind HUMANA INC and Teton Westwood Small 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.| Teton Westwood vs. Teton Westwood Mighty | Teton Westwood vs. The Gabelli Utilities | Teton Westwood vs. The Gabelli Small |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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