Correlation Between HUMANA and SavMobi Technology

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

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

Diversification Opportunities for HUMANA and SavMobi Technology

0.03

Correlation Coefficient

HUMANA  SavMobi Technology

Significant diversification

The 3 months correlation between HUMANA and SavMobi is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and SavMobi Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SavMobi Technology 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 SavMobi Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SavMobi Technology has no effect on the direction of HUMANA i.e., HUMANA and SavMobi Technology go up and down completely randomly.

Pair Corralation between HUMANA and SavMobi Technology

Assuming the 90 days trading horizon HUMANA INC is expected to generate 0.06 times more return on investment than SavMobi Technology. However, HUMANA INC is 16.77 times less risky than SavMobi Technology. It trades about 0.06 of its potential returns per unit of risk. SavMobi Technology is currently generating about -0.06 per unit of risk. If you would invest  7,571  in HUMANA INC on October 5, 2024 and sell it today you would earn a total of  873.00  from holding HUMANA INC or generate 11.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	97.74%
Values	Daily Returns

HUMANA INC  vs.  SavMobi Technology

HUMANA INC

Risk-Adjusted Performance

4 of 100

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. 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.

SavMobi Technology

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SavMobi Technology are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, SavMobi Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HUMANA and SavMobi Technology

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

The idea behind HUMANA INC and SavMobi Technology 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.