Correlation Between Assurant and Horace Mann
Can any of the company-specific risk be diversified away by investing in both Assurant and Horace Mann 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 Assurant and Horace Mann into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Assurant and Horace Mann Educators, you can compare the effects of market volatilities on Assurant and Horace Mann 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 Assurant with a short position of Horace Mann. Check out your portfolio center. Please also check ongoing floating volatility patterns of Assurant and Horace Mann.
Diversification Opportunities for Assurant and Horace Mann
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Assurant and Horace is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Assurant and Horace Mann Educators in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horace Mann Educators and Assurant 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 Assurant are associated (or correlated) with Horace Mann. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horace Mann Educators has no effect on the direction of Assurant i.e., Assurant and Horace Mann go up and down completely randomly.
Pair Corralation between Assurant and Horace Mann
Considering the 90-day investment horizon Assurant is expected to generate 0.82 times more return on investment than Horace Mann. However, Assurant is 1.22 times less risky than Horace Mann. It trades about 0.08 of its potential returns per unit of risk. Horace Mann Educators is currently generating about 0.06 per unit of risk. If you would invest 19,609 in Assurant on November 2, 2024 and sell it today you would earn a total of 2,258 from holding Assurant or generate 11.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Assurant vs. Horace Mann Educators
Performance |
| Timeline |
| Assurant |
| Horace Mann Educators |
Assurant and Horace Mann Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Assurant and Horace Mann
The main advantage of trading using opposite Assurant and Horace Mann positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Assurant position performs unexpectedly, Horace Mann 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 Horace Mann will offset losses from the drop in Horace Mann's long position.| Assurant vs. Assured Guaranty | Assurant vs. Ambac Financial Group | Assurant vs. AMERISAFE | Assurant vs. Enact Holdings |
| Horace Mann vs. Kemper | Horace Mann vs. RLI Corp | Horace Mann vs. Global Indemnity PLC | Horace Mann vs. Argo Group International |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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