Correlation Between SEI Investments and China Gas
Can any of the company-specific risk be diversified away by investing in both SEI Investments and China Gas 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 SEI Investments and China Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI Investments and China Gas Holdings, you can compare the effects of market volatilities on SEI Investments and China Gas 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 SEI Investments with a short position of China Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI Investments and China Gas.
Diversification Opportunities for SEI Investments and China Gas
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SEI and China is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding SEI Investments and China Gas Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Gas Holdings and SEI Investments 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 SEI Investments are associated (or correlated) with China Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Gas Holdings has no effect on the direction of SEI Investments i.e., SEI Investments and China Gas go up and down completely randomly.
Pair Corralation between SEI Investments and China Gas
Given the investment horizon of 90 days SEI Investments is expected to generate 0.5 times more return on investment than China Gas. However, SEI Investments is 2.01 times less risky than China Gas. It trades about 0.14 of its potential returns per unit of risk. China Gas Holdings is currently generating about 0.02 per unit of risk. If you would invest 5,746 in SEI Investments on September 14, 2024 and sell it today you would earn a total of 2,774 from holding SEI Investments or generate 48.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.42% |
| Values | Daily Returns |
SEI Investments vs. China Gas Holdings
Performance |
| Timeline |
| SEI Investments |
| China Gas Holdings |
SEI Investments and China Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEI Investments and China Gas
The main advantage of trading using opposite SEI Investments and China Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI Investments position performs unexpectedly, China Gas 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 China Gas will offset losses from the drop in China Gas' long position.| SEI Investments vs. Visa Class A | SEI Investments vs. Diamond Hill Investment | SEI Investments vs. Distoken Acquisition | SEI Investments vs. AllianceBernstein Holding LP |
| China Gas vs. Inflection Point Acquisition | China Gas vs. SEI Investments | China Gas vs. Asure Software | China Gas vs. Paysafe |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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