Correlation Between Credit Acceptance and Sea
Can any of the company-specific risk be diversified away by investing in both Credit Acceptance and Sea 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 Credit Acceptance and Sea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Acceptance and Sea Limited, you can compare the effects of market volatilities on Credit Acceptance and Sea 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 Credit Acceptance with a short position of Sea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Acceptance and Sea.
Diversification Opportunities for Credit Acceptance and Sea
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Credit and Sea is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Credit Acceptance and Sea Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sea Limited and Credit Acceptance 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 Credit Acceptance are associated (or correlated) with Sea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sea Limited has no effect on the direction of Credit Acceptance i.e., Credit Acceptance and Sea go up and down completely randomly.
Pair Corralation between Credit Acceptance and Sea
If you would invest 2,264 in Sea Limited on August 24, 2024 and sell it today you would earn a total of 433.00 from holding Sea Limited or generate 19.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Credit Acceptance vs. Sea Limited
Performance |
| Timeline |
| Credit Acceptance |
| Sea Limited |
Credit Acceptance and Sea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credit Acceptance and Sea
The main advantage of trading using opposite Credit Acceptance and Sea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Acceptance position performs unexpectedly, Sea 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 Sea will offset losses from the drop in Sea's long position.| Credit Acceptance vs. Capital One Financial | Credit Acceptance vs. Bread Financial Holdings | Credit Acceptance vs. Fras le SA | Credit Acceptance vs. Clave Indices De |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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