Correlation Between Joint Corp and Humana

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

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

Diversification Opportunities for Joint Corp and Humana

0.23

Correlation Coefficient

Joint Corp  Humana

Modest diversification

The 3 months correlation between Joint and Humana is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding The Joint Corp and Humana Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humana Inc and Joint 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 The Joint Corp 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 Joint Corp i.e., Joint Corp and Humana go up and down completely randomly.

Pair Corralation between Joint Corp and Humana

Given the investment horizon of 90 days The Joint Corp is expected to generate 1.07 times more return on investment than Humana. However, Joint Corp is 1.07 times more volatile than Humana Inc. It trades about 0.19 of its potential returns per unit of risk. Humana Inc is currently generating about 0.06 per unit of risk. If you would invest  995.00  in The Joint Corp on December 28, 2024 and sell it today you would earn a total of  280.00  from holding The Joint Corp or generate 28.14% return on investment over 90 days.

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

The Joint Corp  vs.  Humana Inc

Joint Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in The Joint Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Joint Corp unveiled solid returns over the last few months and may actually be approaching a breakup point.

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.

Pair Trading with Joint Corp and Humana

The main advantage of trading using opposite Joint Corp and Humana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Joint Corp 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 The Joint Corp 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.

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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.