Correlation Between CDL INVESTMENT and SEI INVESTMENTS
Can any of the company-specific risk be diversified away by investing in both CDL INVESTMENT 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 CDL INVESTMENT and SEI INVESTMENTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CDL INVESTMENT and SEI INVESTMENTS, you can compare the effects of market volatilities on CDL INVESTMENT 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 CDL INVESTMENT with a short position of SEI INVESTMENTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of CDL INVESTMENT and SEI INVESTMENTS.
Diversification Opportunities for CDL INVESTMENT and SEI INVESTMENTS
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CDL and SEI is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding CDL INVESTMENT and SEI INVESTMENTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI INVESTMENTS and CDL INVESTMENT 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 CDL INVESTMENT 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 CDL INVESTMENT i.e., CDL INVESTMENT and SEI INVESTMENTS go up and down completely randomly.
Pair Corralation between CDL INVESTMENT and SEI INVESTMENTS
Assuming the 90 days trading horizon CDL INVESTMENT is expected to under-perform the SEI INVESTMENTS. In addition to that, CDL INVESTMENT is 1.44 times more volatile than SEI INVESTMENTS. It trades about -0.06 of its total potential returns per unit of risk. SEI INVESTMENTS is currently generating about 0.33 per unit of volatility. If you would invest 6,150 in SEI INVESTMENTS on August 25, 2024 and sell it today you would earn a total of 1,450 from holding SEI INVESTMENTS or generate 23.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CDL INVESTMENT vs. SEI INVESTMENTS
Performance |
| Timeline |
| CDL INVESTMENT |
| SEI INVESTMENTS |
CDL INVESTMENT and SEI INVESTMENTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CDL INVESTMENT and SEI INVESTMENTS
The main advantage of trading using opposite CDL INVESTMENT and SEI INVESTMENTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CDL INVESTMENT 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.| CDL INVESTMENT vs. United Natural Foods | CDL INVESTMENT vs. Jacquet Metal Service | CDL INVESTMENT vs. SIMS METAL MGT | CDL INVESTMENT vs. Tyson Foods |
| SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Apple Inc |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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