Correlation Between HUMANA and Advent Technologies

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

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

Diversification Opportunities for HUMANA and Advent Technologies

-0.02

Correlation Coefficient

HUMANA  Advent Technologies

Good diversification

The 3 months correlation between HUMANA and Advent is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding HUMANA INC and Advent Technologies Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advent Technologies 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 Advent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advent Technologies has no effect on the direction of HUMANA i.e., HUMANA and Advent Technologies go up and down completely randomly.

Pair Corralation between HUMANA and Advent Technologies

If you would invest (100.00) in Advent Technologies Holdings on September 12, 2024 and sell it today you would earn a total of  100.00  from holding Advent Technologies Holdings or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

HUMANA INC  vs.  Advent Technologies Holdings

HUMANA INC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HUMANA INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for HUMANA INC investors.

Advent Technologies

Risk-Adjusted Performance

0 of 100

Insignificant

Over the last 90 days Advent Technologies Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly weak basic indicators, Advent Technologies showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HUMANA and Advent Technologies

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

The idea behind HUMANA INC and Advent Technologies Holdings 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.