Correlation Between REGAL ASIAN and SEI INVESTMENTS
Can any of the company-specific risk be diversified away by investing in both REGAL ASIAN and SEI INVESTMENTS 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 REGAL ASIAN and SEI INVESTMENTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REGAL ASIAN INVESTMENTS and SEI INVESTMENTS, you can compare the effects of market volatilities on REGAL ASIAN and SEI INVESTMENTS 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 REGAL ASIAN with a short position of SEI INVESTMENTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of REGAL ASIAN and SEI INVESTMENTS.
Diversification Opportunities for REGAL ASIAN and SEI INVESTMENTS
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between REGAL and SEI is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding REGAL ASIAN INVESTMENTS and SEI INVESTMENTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI INVESTMENTS and REGAL ASIAN 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 REGAL ASIAN INVESTMENTS are associated (or correlated) with SEI INVESTMENTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEI INVESTMENTS has no effect on the direction of REGAL ASIAN i.e., REGAL ASIAN and SEI INVESTMENTS go up and down completely randomly.
Pair Corralation between REGAL ASIAN and SEI INVESTMENTS
Assuming the 90 days trading horizon REGAL ASIAN is expected to generate 4.76 times less return on investment than SEI INVESTMENTS. But when comparing it to its historical volatility, REGAL ASIAN INVESTMENTS is 1.15 times less risky than SEI INVESTMENTS. It trades about 0.08 of its potential returns per unit of risk. SEI INVESTMENTS is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 6,900 in SEI INVESTMENTS on August 28, 2024 and sell it today you would earn a total of 850.00 from holding SEI INVESTMENTS or generate 12.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
REGAL ASIAN INVESTMENTS vs. SEI INVESTMENTS
Performance |
| Timeline |
| REGAL ASIAN INVESTMENTS |
| SEI INVESTMENTS |
REGAL ASIAN and SEI INVESTMENTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REGAL ASIAN and SEI INVESTMENTS
The main advantage of trading using opposite REGAL ASIAN and SEI INVESTMENTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REGAL ASIAN position performs unexpectedly, SEI INVESTMENTS 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 SEI INVESTMENTS will offset losses from the drop in SEI INVESTMENTS's long position.| REGAL ASIAN vs. Choice Hotels International | REGAL ASIAN vs. Meli Hotels International | REGAL ASIAN vs. InterContinental Hotels Group | REGAL ASIAN vs. METHODE ELECTRONICS |
| SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Microsoft |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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