Correlation Between SEAZEN GROUP and CIFI Holdings
Can any of the company-specific risk be diversified away by investing in both SEAZEN GROUP and CIFI Holdings 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 SEAZEN GROUP and CIFI Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEAZEN GROUP LTD and CIFI Holdings Co, you can compare the effects of market volatilities on SEAZEN GROUP and CIFI Holdings 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 SEAZEN GROUP with a short position of CIFI Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEAZEN GROUP and CIFI Holdings.
Diversification Opportunities for SEAZEN GROUP and CIFI Holdings
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SEAZEN and CIFI is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding SEAZEN GROUP LTD and CIFI Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIFI Holdings and SEAZEN GROUP 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 SEAZEN GROUP LTD are associated (or correlated) with CIFI Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIFI Holdings has no effect on the direction of SEAZEN GROUP i.e., SEAZEN GROUP and CIFI Holdings go up and down completely randomly.
Pair Corralation between SEAZEN GROUP and CIFI Holdings
Assuming the 90 days trading horizon SEAZEN GROUP LTD is expected to generate 0.63 times more return on investment than CIFI Holdings. However, SEAZEN GROUP LTD is 1.59 times less risky than CIFI Holdings. It trades about -0.2 of its potential returns per unit of risk. CIFI Holdings Co is currently generating about -0.18 per unit of risk. If you would invest 27.00 in SEAZEN GROUP LTD on August 31, 2024 and sell it today you would lose (4.00) from holding SEAZEN GROUP LTD or give up 14.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 91.3% |
| Values | Daily Returns |
SEAZEN GROUP LTD vs. CIFI Holdings Co
Performance |
| Timeline |
| SEAZEN GROUP LTD |
| CIFI Holdings |
SEAZEN GROUP and CIFI Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEAZEN GROUP and CIFI Holdings
The main advantage of trading using opposite SEAZEN GROUP and CIFI Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEAZEN GROUP position performs unexpectedly, CIFI Holdings 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 CIFI Holdings will offset losses from the drop in CIFI Holdings' long position.| SEAZEN GROUP vs. China Resources Land | SEAZEN GROUP vs. CTP NV EO | SEAZEN GROUP vs. Superior Plus Corp | SEAZEN GROUP vs. NMI Holdings |
| CIFI Holdings vs. China Resources Land | CIFI Holdings vs. CTP NV EO | CIFI Holdings vs. Superior Plus Corp | CIFI Holdings vs. NMI Holdings |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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