Correlation Between Humana and Robo Global

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

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

Diversification Opportunities for Humana and Robo Global

0.36

Correlation Coefficient

Humana  Robo Global

Weak diversification

The 3 months correlation between Humana and Robo is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Humana Inc and Robo Global Artificial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robo Global Artificial and Humana 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 Humana Inc are associated (or correlated) with Robo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robo Global Artificial has no effect on the direction of Humana i.e., Humana and Robo Global go up and down completely randomly.

Pair Corralation between Humana and Robo Global

Considering the 90-day investment horizon Humana Inc is expected to generate 1.26 times more return on investment than Robo Global. However, Humana is 1.26 times more volatile than Robo Global Artificial. It trades about 0.06 of its potential returns per unit of risk. Robo Global Artificial is currently generating about -0.05 per unit of risk. If you would invest  25,475  in Humana Inc on December 27, 2024 and sell it today you would earn a total of  1,573  from holding Humana Inc or generate 6.17% return on investment over 90 days.

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

Humana Inc  vs.  Robo Global Artificial

Humana Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Humana Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Humana may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Robo Global Artificial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Robo Global Artificial has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Robo Global is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Humana and Robo Global

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

The idea behind Humana Inc and Robo Global Artificial 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.