Correlation Between Globe Life and Unum
Can any of the company-specific risk be diversified away by investing in both Globe Life 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 Globe Life and Unum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Globe Life and Unum Group, you can compare the effects of market volatilities on Globe Life 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 Globe Life with a short position of Unum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globe Life and Unum.
Diversification Opportunities for Globe Life and Unum
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Globe and Unum is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Globe Life and Unum Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unum Group and Globe Life 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 Globe Life 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 Globe Life i.e., Globe Life and Unum go up and down completely randomly.
Pair Corralation between Globe Life and Unum
Allowing for the 90-day total investment horizon Globe Life is expected to generate 1.29 times more return on investment than Unum. However, Globe Life is 1.29 times more volatile than Unum Group. It trades about 0.49 of its potential returns per unit of risk. Unum Group is currently generating about 0.43 per unit of risk. If you would invest 11,128 in Globe Life on November 1, 2024 and sell it today you would earn a total of 1,116 from holding Globe Life or generate 10.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Globe Life vs. Unum Group
Performance |
| Timeline |
| Globe Life |
| Unum Group |
Globe Life and Unum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globe Life and Unum
The main advantage of trading using opposite Globe Life and Unum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globe Life 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.| Globe Life vs. Prudential PLC ADR | Globe Life vs. CNO Financial Group | Globe Life vs. MetLife Preferred Stock | Globe Life vs. MetLife |
| Unum vs. Prudential Financial | Unum vs. MetLife | Unum vs. Jackson Financial | Unum vs. Manulife Financial Corp |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |