Correlation Between Aldel Financial and Unum
Can any of the company-specific risk be diversified away by investing in both Aldel Financial and Unum 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 Aldel Financial and Unum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aldel Financial II and Unum Group, you can compare the effects of market volatilities on Aldel Financial and Unum 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 Aldel Financial with a short position of Unum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aldel Financial and Unum.
Diversification Opportunities for Aldel Financial and Unum
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aldel and Unum is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Aldel Financial II and Unum Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unum Group and Aldel Financial 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 Aldel Financial II are associated (or correlated) with Unum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unum Group has no effect on the direction of Aldel Financial i.e., Aldel Financial and Unum go up and down completely randomly.
Pair Corralation between Aldel Financial and Unum
Assuming the 90 days horizon Aldel Financial is expected to generate 340.0 times less return on investment than Unum. But when comparing it to its historical volatility, Aldel Financial II is 4.94 times less risky than Unum. It trades about 0.0 of its potential returns per unit of risk. Unum Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,348 in Unum Group on September 3, 2024 and sell it today you would earn a total of 181.00 from holding Unum Group or generate 7.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 12.72% |
| Values | Daily Returns |
Aldel Financial II vs. Unum Group
Performance |
| Timeline |
| Aldel Financial II |
| Unum Group |
Aldel Financial and Unum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aldel Financial and Unum
The main advantage of trading using opposite Aldel Financial and Unum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aldel Financial position performs unexpectedly, Unum 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 Unum will offset losses from the drop in Unum's long position.| Aldel Financial vs. Distoken Acquisition | Aldel Financial vs. Voyager Acquisition Corp | Aldel Financial vs. dMY Squared Technology | Aldel Financial vs. YHN Acquisition I |
| Unum vs. Keurig Dr Pepper | Unum vs. Chipotle Mexican Grill | Unum vs. Suntory Beverage Food | Unum vs. Shake Shack |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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