Correlation Between HUMANA and Global Payments
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By analyzing existing cross correlation between HUMANA INC and Global Payments, you can compare the effects of market volatilities on HUMANA and Global Payments 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 Global Payments. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUMANA and Global Payments.
Diversification Opportunities for HUMANA and Global Payments
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HUMANA and Global is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Global Payments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Payments 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 Global Payments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Payments has no effect on the direction of HUMANA i.e., HUMANA and Global Payments go up and down completely randomly.
Pair Corralation between HUMANA and Global Payments
Assuming the 90 days trading horizon HUMANA INC is expected to generate 50.16 times more return on investment than Global Payments. However, HUMANA is 50.16 times more volatile than Global Payments. It trades about 0.07 of its potential returns per unit of risk. Global Payments is currently generating about 0.02 per unit of risk. If you would invest 7,788 in HUMANA INC on January 31, 2024 and sell it today you would earn a total of 308.00 from holding HUMANA INC or generate 3.95% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 97.84% |
Values | Daily Returns |
HUMANA INC vs. Global Payments
Performance |
Timeline |
HUMANA INC |
Global Payments |
HUMANA and Global Payments Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with HUMANA and Global Payments
The main advantage of trading using opposite HUMANA and Global Payments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUMANA position performs unexpectedly, Global Payments 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 Global Payments will offset losses from the drop in Global Payments' long position.HUMANA vs. AEP TEX INC | HUMANA vs. US BANK NATIONAL | HUMANA vs. Can B Corp | HUMANA vs. Comfort Systems USA |
Global Payments vs. Copart Inc | Global Payments vs. ABM Industries Incorporated | Global Payments vs. Thomson Reuters Corp | Global Payments vs. Aramark Holdings |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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