Correlation Between Aflac Incorporated and Aetna
Can any of the company-specific risk be diversified away by investing in both Aflac Incorporated and Aetna 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 Aflac Incorporated and Aetna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aflac Incorporated and Aetna Inc, you can compare the effects of market volatilities on Aflac Incorporated and Aetna 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 Aflac Incorporated with a short position of Aetna. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aflac Incorporated and Aetna.
Diversification Opportunities for Aflac Incorporated and Aetna
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aflac and Aetna is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aflac Incorporated and Aetna Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aetna Inc and Aflac Incorporated 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 Aflac Incorporated are associated (or correlated) with Aetna. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aetna Inc has no effect on the direction of Aflac Incorporated i.e., Aflac Incorporated and Aetna go up and down completely randomly.
Pair Corralation between Aflac Incorporated and Aetna
If you would invest (100.00) in Aetna Inc on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Aetna Inc or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Aflac Incorporated vs. Aetna Inc
Performance |
| Timeline |
| Aflac Incorporated |
| Aetna Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Aflac Incorporated and Aetna Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aflac Incorporated and Aetna
The main advantage of trading using opposite Aflac Incorporated and Aetna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aflac Incorporated position performs unexpectedly, Aetna 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 Aetna will offset losses from the drop in Aetna's long position.| Aflac Incorporated vs. Prudential Financial | Aflac Incorporated vs. Lincoln National | Aflac Incorporated vs. Brighthouse Financial | Aflac Incorporated vs. Unum Group |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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