Correlation Between Elevance Health, and UnitedHealth Group
Can any of the company-specific risk be diversified away by investing in both Elevance Health, and UnitedHealth Group 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 Elevance Health, and UnitedHealth Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elevance Health, and UnitedHealth Group Incorporated, you can compare the effects of market volatilities on Elevance Health, and UnitedHealth Group 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 Elevance Health, with a short position of UnitedHealth Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elevance Health, and UnitedHealth Group.
Diversification Opportunities for Elevance Health, and UnitedHealth Group
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Elevance and UnitedHealth is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Elevance Health, and UnitedHealth Group Incorporate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UnitedHealth Group and Elevance Health, 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 Elevance Health, are associated (or correlated) with UnitedHealth Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UnitedHealth Group has no effect on the direction of Elevance Health, i.e., Elevance Health, and UnitedHealth Group go up and down completely randomly.
Pair Corralation between Elevance Health, and UnitedHealth Group
If you would invest 47,249 in Elevance Health, on October 10, 2024 and sell it today you would earn a total of 0.00 from holding Elevance Health, or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 94.74% |
Values | Daily Returns |
Elevance Health, vs. UnitedHealth Group Incorporate
Performance |
Timeline |
Elevance Health, |
UnitedHealth Group |
Elevance Health, and UnitedHealth Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Elevance Health, and UnitedHealth Group
The main advantage of trading using opposite Elevance Health, and UnitedHealth Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elevance Health, position performs unexpectedly, UnitedHealth Group 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 UnitedHealth Group will offset losses from the drop in UnitedHealth Group's long position.Elevance Health, vs. Discover Financial Services | Elevance Health, vs. Applied Materials, | Elevance Health, vs. ICICI Bank Limited | Elevance Health, vs. Credit Acceptance |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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