Correlation Between OTP Bank and Humana

Can any of the company-specific risk be diversified away by investing in both OTP Bank and Humana at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining OTP Bank and Humana into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between OTP Bank Nyrt and Humana Inc, you can compare the effects of market volatilities on OTP Bank and Humana 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 OTP Bank with a short position of Humana. Check out your portfolio center. Please also check ongoing floating volatility patterns of OTP Bank and Humana.

Diversification Opportunities for OTP Bank and Humana

0.0

Correlation Coefficient

OTP Bank  Humana

Pay attention - limited upside

The 3 months correlation between OTP and Humana is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding OTP Bank Nyrt and Humana Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humana Inc and OTP Bank 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 OTP Bank Nyrt are associated (or correlated) with Humana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humana Inc has no effect on the direction of OTP Bank i.e., OTP Bank and Humana go up and down completely randomly.

Pair Corralation between OTP Bank and Humana

If you would invest  25,318  in Humana Inc on December 30, 2024 and sell it today you would earn a total of  1,463  from holding Humana Inc or generate 5.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

OTP Bank Nyrt  vs.  Humana Inc

OTP Bank Nyrt

Risk-Adjusted Performance

Very Weak

Over the last 90 days OTP Bank Nyrt has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, OTP Bank is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Humana Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Humana Inc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Humana may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with OTP Bank and Humana

The main advantage of trading using opposite OTP Bank and Humana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OTP Bank position performs unexpectedly, Humana 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 Humana will offset losses from the drop in Humana's long position.

The idea behind OTP Bank Nyrt and Humana Inc 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.

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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 Stocks Directory module to find actively traded stocks across global markets.