Correlation Between Unum and Sligro Food
Can any of the company-specific risk be diversified away by investing in both Unum and Sligro Food 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 Sligro Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unum Group and Sligro Food Group, you can compare the effects of market volatilities on Unum and Sligro Food 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 Sligro Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unum and Sligro Food.
Diversification Opportunities for Unum and Sligro Food
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Unum and Sligro is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Unum Group and Sligro Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sligro Food 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 Sligro Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sligro Food Group has no effect on the direction of Unum i.e., Unum and Sligro Food go up and down completely randomly.
Pair Corralation between Unum and Sligro Food
Considering the 90-day investment horizon Unum Group is expected to generate 1.17 times more return on investment than Sligro Food. However, Unum is 1.17 times more volatile than Sligro Food Group. It trades about 0.24 of its potential returns per unit of risk. Sligro Food Group is currently generating about -0.05 per unit of risk. If you would invest 5,217 in Unum Group on November 3, 2024 and sell it today you would earn a total of 2,408 from holding Unum Group or generate 46.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 97.66% |
| Values | Daily Returns |
Unum Group vs. Sligro Food Group
Performance |
| Timeline |
| Unum Group |
| Sligro Food Group |
Unum and Sligro Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unum and Sligro Food
The main advantage of trading using opposite Unum and Sligro Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unum position performs unexpectedly, Sligro Food 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 Sligro Food will offset losses from the drop in Sligro Food's long position.| Unum vs. Prudential Financial | Unum vs. MetLife | Unum vs. Jackson Financial | Unum vs. Manulife Financial Corp |
| Sligro Food vs. City Office REIT | Sligro Food vs. Allient | Sligro Food vs. Eddy Smart Home | Sligro Food vs. TRI Pointe Homes |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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