Correlation Between Unum and Aflac Incorporated
Can any of the company-specific risk be diversified away by investing in both Unum and Aflac Incorporated 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 Unum and Aflac Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unum Group and Aflac Incorporated, you can compare the effects of market volatilities on Unum and Aflac Incorporated 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 Unum with a short position of Aflac Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unum and Aflac Incorporated.
Diversification Opportunities for Unum and Aflac Incorporated
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Unum and Aflac is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Unum Group and Aflac Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aflac Incorporated and Unum 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 Unum Group are associated (or correlated) with Aflac Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aflac Incorporated has no effect on the direction of Unum i.e., Unum and Aflac Incorporated go up and down completely randomly.
Pair Corralation between Unum and Aflac Incorporated
Considering the 90-day investment horizon Unum Group is expected to generate 0.64 times more return on investment than Aflac Incorporated. However, Unum Group is 1.56 times less risky than Aflac Incorporated. It trades about 0.31 of its potential returns per unit of risk. Aflac Incorporated is currently generating about 0.2 per unit of risk. If you would invest 7,252 in Unum Group on November 3, 2024 and sell it today you would earn a total of 373.00 from holding Unum Group or generate 5.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unum Group vs. Aflac Incorporated
Performance |
| Timeline |
| Unum Group |
| Aflac Incorporated |
Unum and Aflac Incorporated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unum and Aflac Incorporated
The main advantage of trading using opposite Unum and Aflac Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unum position performs unexpectedly, Aflac Incorporated 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 Aflac Incorporated will offset losses from the drop in Aflac Incorporated's long position.| Unum vs. Prudential Financial | Unum vs. MetLife | Unum vs. Jackson Financial | Unum vs. Manulife Financial Corp |
| Aflac Incorporated vs. Prudential Financial | Aflac Incorporated vs. Lincoln National | Aflac Incorporated vs. Brighthouse Financial | Aflac Incorporated vs. Unum Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |