Correlation Between Cigna Corp and Bluejay Diagnostics
Can any of the company-specific risk be diversified away by investing in both Cigna Corp and Bluejay Diagnostics 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 Cigna Corp and Bluejay Diagnostics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cigna Corp and Bluejay Diagnostics, you can compare the effects of market volatilities on Cigna Corp and Bluejay Diagnostics 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 Cigna Corp with a short position of Bluejay Diagnostics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cigna Corp and Bluejay Diagnostics.
Diversification Opportunities for Cigna Corp and Bluejay Diagnostics
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cigna and Bluejay is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Cigna Corp and Bluejay Diagnostics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluejay Diagnostics and Cigna Corp 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 Cigna Corp are associated (or correlated) with Bluejay Diagnostics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluejay Diagnostics has no effect on the direction of Cigna Corp i.e., Cigna Corp and Bluejay Diagnostics go up and down completely randomly.
Pair Corralation between Cigna Corp and Bluejay Diagnostics
Allowing for the 90-day total investment horizon Cigna Corp is expected to generate 0.13 times more return on investment than Bluejay Diagnostics. However, Cigna Corp is 7.82 times less risky than Bluejay Diagnostics. It trades about -0.08 of its potential returns per unit of risk. Bluejay Diagnostics is currently generating about -0.12 per unit of risk. If you would invest 35,214 in Cigna Corp on September 24, 2024 and sell it today you would lose (7,522) from holding Cigna Corp or give up 21.36% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Cigna Corp vs. Bluejay Diagnostics
Performance |
Timeline |
Cigna Corp |
Bluejay Diagnostics |
Cigna Corp and Bluejay Diagnostics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cigna Corp and Bluejay Diagnostics
The main advantage of trading using opposite Cigna Corp and Bluejay Diagnostics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cigna Corp position performs unexpectedly, Bluejay Diagnostics 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 Bluejay Diagnostics will offset losses from the drop in Bluejay Diagnostics' long position.Cigna Corp vs. Elevance Health | Cigna Corp vs. UnitedHealth Group Incorporated | Cigna Corp vs. Centene Corp | Cigna Corp vs. Molina Healthcare |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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