Correlation Between Fobi AI and HUMANA

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

By analyzing existing cross correlation between Fobi AI and HUMANA INC, you can compare the effects of market volatilities on Fobi AI 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 Fobi AI with a short position of HUMANA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fobi AI and HUMANA.

Diversification Opportunities for Fobi AI and HUMANA

0.16

Correlation Coefficient

Fobi AI  HUMANA

Average diversification

The 3 months correlation between Fobi and HUMANA is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Fobi AI and HUMANA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUMANA INC and Fobi AI 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 Fobi AI 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 Fobi AI i.e., Fobi AI and HUMANA go up and down completely randomly.

Pair Corralation between Fobi AI and HUMANA

If you would invest  4.00  in Fobi AI on October 7, 2024 and sell it today you would earn a total of  0.00  from holding Fobi AI or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

Fobi AI  vs.  HUMANA INC

Fobi AI

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fobi AI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental drivers remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

HUMANA INC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HUMANA INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, HUMANA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Fobi AI and HUMANA

The main advantage of trading using opposite Fobi AI and HUMANA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fobi AI 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 Fobi AI 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.