Correlation Between UnitedHealth Group and Fluor

Can any of the company-specific risk be diversified away by investing in both UnitedHealth Group and Fluor 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 Fluor 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 Fluor, you can compare the effects of market volatilities on UnitedHealth Group and Fluor 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 Fluor. Check out your portfolio center. Please also check ongoing floating volatility patterns of UnitedHealth Group and Fluor.

Diversification Opportunities for UnitedHealth Group and Fluor

0.0

Correlation Coefficient

UnitedHealth Group  Fluor

Pay attention - limited upside

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

Pair Corralation between UnitedHealth Group and Fluor

If you would invest  1,021,654  in UnitedHealth Group Incorporated on December 24, 2024 and sell it today you would earn a total of  19,846  from holding UnitedHealth Group Incorporated or generate 1.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

UnitedHealth Group Incorporate  vs.  Fluor

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 1 (%) 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.

Fluor

Risk-Adjusted Performance

Very Weak

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

Pair Trading with UnitedHealth Group and Fluor

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

The idea behind UnitedHealth Group Incorporated and Fluor 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.