Correlation Between LiCycle Holdings and SEI Investments
Can any of the company-specific risk be diversified away by investing in both LiCycle Holdings 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 LiCycle Holdings and SEI Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LiCycle Holdings Corp and SEI Investments, you can compare the effects of market volatilities on LiCycle Holdings 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 LiCycle Holdings with a short position of SEI Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of LiCycle Holdings and SEI Investments.
Diversification Opportunities for LiCycle Holdings and SEI Investments
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LiCycle and SEI is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding LiCycle Holdings Corp and SEI Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI Investments and LiCycle Holdings 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 LiCycle Holdings Corp 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 LiCycle Holdings i.e., LiCycle Holdings and SEI Investments go up and down completely randomly.
Pair Corralation between LiCycle Holdings and SEI Investments
Given the investment horizon of 90 days LiCycle Holdings Corp is expected to under-perform the SEI Investments. In addition to that, LiCycle Holdings is 3.41 times more volatile than SEI Investments. It trades about -0.13 of its total potential returns per unit of risk. SEI Investments is currently generating about -0.15 per unit of volatility. If you would invest 8,345 in SEI Investments on November 27, 2024 and sell it today you would lose (343.00) from holding SEI Investments or give up 4.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LiCycle Holdings Corp vs. SEI Investments
Performance |
| Timeline |
| LiCycle Holdings Corp |
| SEI Investments |
LiCycle Holdings and SEI Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LiCycle Holdings and SEI Investments
The main advantage of trading using opposite LiCycle Holdings and SEI Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LiCycle Holdings 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.| LiCycle Holdings vs. Casella Waste Systems | LiCycle Holdings vs. Perma Fix Environmental Svcs | LiCycle Holdings vs. Montrose Environmental Grp | LiCycle Holdings vs. LanzaTech Global |
| 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |