Correlation Between Supercom and Unum
Can any of the company-specific risk be diversified away by investing in both Supercom 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 Supercom and Unum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Supercom and Unum Group, you can compare the effects of market volatilities on Supercom 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 Supercom with a short position of Unum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supercom and Unum.
Diversification Opportunities for Supercom and Unum
Good diversification
The 3 months correlation between Supercom and Unum is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Supercom and Unum Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unum Group and Supercom 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 Supercom 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 Supercom i.e., Supercom and Unum go up and down completely randomly.
Pair Corralation between Supercom and Unum
Given the investment horizon of 90 days Supercom is expected to generate 14.91 times more return on investment than Unum. However, Supercom is 14.91 times more volatile than Unum Group. It trades about 0.01 of its potential returns per unit of risk. Unum Group is currently generating about 0.06 per unit of risk. If you would invest 660.00 in Supercom on September 3, 2024 and sell it today you would lose (294.00) from holding Supercom or give up 44.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Supercom vs. Unum Group
Performance |
| Timeline |
| Supercom |
| Unum Group |
Supercom and Unum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supercom and Unum
The main advantage of trading using opposite Supercom and Unum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supercom 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.| Supercom vs. Zedcor Inc | Supercom vs. SSC Security Services | Supercom vs. Blue Line Protection | Supercom vs. Guardforce AI Co |
| 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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