Correlation Between Assurant and TruBridge
Can any of the company-specific risk be diversified away by investing in both Assurant and TruBridge 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 TruBridge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Assurant and TruBridge, you can compare the effects of market volatilities on Assurant and TruBridge 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 TruBridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Assurant and TruBridge.
Diversification Opportunities for Assurant and TruBridge
Almost no diversification
The 3 months correlation between Assurant and TruBridge is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Assurant and TruBridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TruBridge 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 TruBridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TruBridge has no effect on the direction of Assurant i.e., Assurant and TruBridge go up and down completely randomly.
Pair Corralation between Assurant and TruBridge
Considering the 90-day investment horizon Assurant is expected to generate 0.48 times more return on investment than TruBridge. However, Assurant is 2.1 times less risky than TruBridge. It trades about 0.08 of its potential returns per unit of risk. TruBridge is currently generating about -0.01 per unit of risk. If you would invest 12,787 in Assurant on September 2, 2024 and sell it today you would earn a total of 9,923 from holding Assurant or generate 77.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Assurant vs. TruBridge
Performance |
| Timeline |
| Assurant |
| TruBridge |
Assurant and TruBridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Assurant and TruBridge
The main advantage of trading using opposite Assurant and TruBridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Assurant position performs unexpectedly, TruBridge 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 TruBridge will offset losses from the drop in TruBridge's long position.| Assurant vs. Assured Guaranty | Assurant vs. Ambac Financial Group | Assurant vs. AMERISAFE | Assurant vs. Enact Holdings |
| TruBridge vs. Inhibrx | TruBridge vs. Spyre Therapeutics | TruBridge vs. Tscan Therapeutics | TruBridge vs. Assurant |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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