Correlation Between UnitedHealth Group and AXA SA

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

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

Diversification Opportunities for UnitedHealth Group and AXA SA

0.0

Correlation Coefficient

UnitedHealth Group  AXA SA

Pay attention - limited upside

The 3 months correlation between UnitedHealth and AXA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding UnitedHealth Group Incorporate and AXA SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AXA SA and UnitedHealth 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 UnitedHealth Group Incorporated are associated (or correlated) with AXA SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AXA SA has no effect on the direction of UnitedHealth Group i.e., UnitedHealth Group and AXA SA go up and down completely randomly.

Pair Corralation between UnitedHealth Group and AXA SA

If you would invest  1,018,866  in UnitedHealth Group Incorporated on December 22, 2024 and sell it today you would earn a total of  22,634  from holding UnitedHealth Group Incorporated or generate 2.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

UnitedHealth Group Incorporate  vs.  AXA SA

UnitedHealth Group

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in UnitedHealth Group Incorporated are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong technical indicators, UnitedHealth Group is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

AXA SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AXA SA are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, AXA SA showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with UnitedHealth Group and AXA SA

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

The idea behind UnitedHealth Group Incorporated and AXA SA 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.