Correlation Between Sabra Health and SEI INVESTMENTS
Can any of the company-specific risk be diversified away by investing in both Sabra Health 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 Sabra Health and SEI INVESTMENTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabra Health Care and SEI INVESTMENTS, you can compare the effects of market volatilities on Sabra Health 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 Sabra Health with a short position of SEI INVESTMENTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabra Health and SEI INVESTMENTS.
Diversification Opportunities for Sabra Health and SEI INVESTMENTS
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sabra and SEI is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Sabra Health Care and SEI INVESTMENTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI INVESTMENTS and Sabra Health 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 Sabra Health Care 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 Sabra Health i.e., Sabra Health and SEI INVESTMENTS go up and down completely randomly.
Pair Corralation between Sabra Health and SEI INVESTMENTS
Assuming the 90 days horizon Sabra Health Care is expected to generate 1.4 times more return on investment than SEI INVESTMENTS. However, Sabra Health is 1.4 times more volatile than SEI INVESTMENTS. It trades about 0.01 of its potential returns per unit of risk. SEI INVESTMENTS is currently generating about -0.56 per unit of risk. If you would invest 1,590 in Sabra Health Care on December 6, 2024 and sell it today you would earn a total of 1.00 from holding Sabra Health Care or generate 0.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Sabra Health Care vs. SEI INVESTMENTS
Performance |
| Timeline |
| Sabra Health Care |
| SEI INVESTMENTS |
Sabra Health and SEI INVESTMENTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabra Health and SEI INVESTMENTS
The main advantage of trading using opposite Sabra Health and SEI INVESTMENTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabra Health 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.| Sabra Health vs. Tradeweb Markets | Sabra Health vs. PENN NATL GAMING | Sabra Health vs. MOVIE GAMES SA | Sabra Health vs. TROPHY GAMES DEV |
| SEI INVESTMENTS vs. Tianjin Capital Environmental | SEI INVESTMENTS vs. Scandinavian Tobacco Group | SEI INVESTMENTS vs. Daido Steel Co | SEI INVESTMENTS vs. Veolia Environnement SA |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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