Correlation Between UnitedHealth Group and Aimia Srs

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Can any of the company-specific risk be diversified away by investing in both UnitedHealth Group and Aimia Srs 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 Aimia Srs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UnitedHealth Group CDR and Aimia Srs 1, you can compare the effects of market volatilities on UnitedHealth Group and Aimia Srs 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 Aimia Srs. Check out your portfolio center. Please also check ongoing floating volatility patterns of UnitedHealth Group and Aimia Srs.

Diversification Opportunities for UnitedHealth Group and Aimia Srs

-0.44
  Correlation Coefficient

Very good diversification

The 3 months correlation between UnitedHealth and Aimia is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding UnitedHealth Group CDR and Aimia Srs 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aimia Srs 1 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 CDR are associated (or correlated) with Aimia Srs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aimia Srs 1 has no effect on the direction of UnitedHealth Group i.e., UnitedHealth Group and Aimia Srs go up and down completely randomly.

Pair Corralation between UnitedHealth Group and Aimia Srs

Assuming the 90 days trading horizon UnitedHealth Group CDR is expected to under-perform the Aimia Srs. In addition to that, UnitedHealth Group is 2.08 times more volatile than Aimia Srs 1. It trades about -0.15 of its total potential returns per unit of risk. Aimia Srs 1 is currently generating about 0.17 per unit of volatility. If you would invest  1,661  in Aimia Srs 1 on April 25, 2025 and sell it today you would earn a total of  299.00  from holding Aimia Srs 1 or generate 18.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

UnitedHealth Group CDR  vs.  Aimia Srs 1

 Performance 
       Timeline  
UnitedHealth Group CDR 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days UnitedHealth Group CDR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in August 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.
Aimia Srs 1 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Aimia Srs 1 are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, Aimia Srs sustained solid returns over the last few months and may actually be approaching a breakup point.

UnitedHealth Group and Aimia Srs Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with UnitedHealth Group and Aimia Srs

The main advantage of trading using opposite UnitedHealth Group and Aimia Srs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UnitedHealth Group position performs unexpectedly, Aimia Srs 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 Aimia Srs will offset losses from the drop in Aimia Srs' long position.
The idea behind UnitedHealth Group CDR and Aimia Srs 1 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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.

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