Correlation Between Unum and Trupanion
Can any of the company-specific risk be diversified away by investing in both Unum and Trupanion 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 Trupanion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unum Group and Trupanion, you can compare the effects of market volatilities on Unum and Trupanion 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 Trupanion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unum and Trupanion.
Diversification Opportunities for Unum and Trupanion
Pay attention - limited upside
The 3 months correlation between Unum and Trupanion is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Unum Group and Trupanion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trupanion 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 Trupanion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trupanion has no effect on the direction of Unum i.e., Unum and Trupanion go up and down completely randomly.
Pair Corralation between Unum and Trupanion
Considering the 90-day investment horizon Unum Group is expected to generate 0.75 times more return on investment than Trupanion. However, Unum Group is 1.33 times less risky than Trupanion. It trades about 0.1 of its potential returns per unit of risk. Trupanion is currently generating about -0.18 per unit of risk. If you would invest 7,046 in Unum Group on August 14, 2025 and sell it today you would earn a total of 688.00 from holding Unum Group or generate 9.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unum Group vs. Trupanion
Performance |
| Timeline |
| Unum Group |
| Trupanion |
Unum and Trupanion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unum and Trupanion
The main advantage of trading using opposite Unum and Trupanion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unum position performs unexpectedly, Trupanion 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 Trupanion will offset losses from the drop in Trupanion's long position.The idea behind Unum Group and Trupanion pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Trupanion vs. Horace Mann Educators | Trupanion vs. The Baldwin Insurance | Trupanion vs. Northwest Bancshares | Trupanion vs. Tri Continental Closed |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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