Correlation Between Concentra Group and Humana

Can any of the company-specific risk be diversified away by investing in both Concentra Group 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 Concentra Group and Humana into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Concentra Group and Humana

0.44

Correlation Coefficient

Concentra Group  Humana

Very weak diversification

The 3 months correlation between Concentra and Humana is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Concentra Group Holdings and Humana Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humana Inc and Concentra Group 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 Concentra Group Holdings 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 Concentra Group i.e., Concentra Group and Humana go up and down completely randomly.

Pair Corralation between Concentra Group and Humana

Considering the 90-day investment horizon Concentra Group Holdings is expected to generate 0.87 times more return on investment than Humana. However, Concentra Group Holdings is 1.14 times less risky than Humana. It trades about 0.07 of its potential returns per unit of risk. Humana Inc is currently generating about 0.05 per unit of risk. If you would invest  2,005  in Concentra Group Holdings on December 29, 2024 and sell it today you would earn a total of  139.00  from holding Concentra Group Holdings or generate 6.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Concentra Group Holdings  vs.  Humana Inc

Concentra Group Holdings

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Concentra Group Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Concentra Group may actually be approaching a critical reversion point that can send shares even higher in April 2025.

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 very healthy basic indicators, Humana is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Concentra Group and Humana

The main advantage of trading using opposite Concentra Group and Humana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concentra Group 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 Concentra Group Holdings 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..