Correlation Between Unum and CNO Financial
Can any of the company-specific risk be diversified away by investing in both Unum and CNO Financial 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 CNO Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unum Group and CNO Financial Group, you can compare the effects of market volatilities on Unum and CNO Financial 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 CNO Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unum and CNO Financial.
Diversification Opportunities for Unum and CNO Financial
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Unum and CNO is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Unum Group and CNO Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNO Financial Group 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 CNO Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNO Financial Group has no effect on the direction of Unum i.e., Unum and CNO Financial go up and down completely randomly.
Pair Corralation between Unum and CNO Financial
Considering the 90-day investment horizon Unum Group is expected to generate 1.28 times more return on investment than CNO Financial. However, Unum is 1.28 times more volatile than CNO Financial Group. It trades about 0.38 of its potential returns per unit of risk. CNO Financial Group is currently generating about -0.1 per unit of risk. If you would invest 6,301 in Unum Group on August 24, 2024 and sell it today you would earn a total of 1,242 from holding Unum Group or generate 19.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unum Group vs. CNO Financial Group
Performance |
| Timeline |
| Unum Group |
| CNO Financial Group |
Unum and CNO Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unum and CNO Financial
The main advantage of trading using opposite Unum and CNO Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unum position performs unexpectedly, CNO Financial 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 CNO Financial will offset losses from the drop in CNO Financial's long position.| Unum vs. Prudential Financial | Unum vs. MetLife | Unum vs. Jackson Financial | Unum vs. Manulife Financial Corp |
| CNO Financial vs. Brighthouse Financial | CNO Financial vs. Brighthouse Financial | CNO Financial vs. MetLife Preferred Stock | CNO Financial vs. Brighthouse Financial |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |