Correlation Between Flutter Entertainment and SEI Investments
Can any of the company-specific risk be diversified away by investing in both Flutter Entertainment 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 Flutter Entertainment and SEI Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flutter Entertainment plc and SEI Investments, you can compare the effects of market volatilities on Flutter Entertainment 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 Flutter Entertainment with a short position of SEI Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flutter Entertainment and SEI Investments.
Diversification Opportunities for Flutter Entertainment and SEI Investments
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Flutter and SEI is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Flutter Entertainment plc and SEI Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI Investments and Flutter Entertainment 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 Flutter Entertainment plc 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 Flutter Entertainment i.e., Flutter Entertainment and SEI Investments go up and down completely randomly.
Pair Corralation between Flutter Entertainment and SEI Investments
Given the investment horizon of 90 days Flutter Entertainment plc is expected to generate 1.78 times more return on investment than SEI Investments. However, Flutter Entertainment is 1.78 times more volatile than SEI Investments. It trades about 0.06 of its potential returns per unit of risk. SEI Investments is currently generating about 0.1 per unit of risk. If you would invest 20,727 in Flutter Entertainment plc on November 3, 2024 and sell it today you would earn a total of 5,970 from holding Flutter Entertainment plc or generate 28.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flutter Entertainment plc vs. SEI Investments
Performance |
| Timeline |
| Flutter Entertainment plc |
| SEI Investments |
Flutter Entertainment and SEI Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flutter Entertainment and SEI Investments
The main advantage of trading using opposite Flutter Entertainment and SEI Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flutter Entertainment 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' long position.| Flutter Entertainment vs. Getty Realty | Flutter Entertainment vs. Rami Levi Chain | Flutter Entertainment vs. Albertsons Companies | Flutter Entertainment vs. MYT Netherlands Parent |
| SEI Investments vs. Commerce Bancshares | SEI Investments vs. RLI Corp | SEI Investments vs. Westamerica Bancorporation | SEI Investments vs. Brown Brown |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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