Correlation Between SEI Investments and Simon Property
Can any of the company-specific risk be diversified away by investing in both SEI Investments and Simon Property 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 Simon Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI Investments and Simon Property Group, you can compare the effects of market volatilities on SEI Investments and Simon Property 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 Simon Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI Investments and Simon Property.
Diversification Opportunities for SEI Investments and Simon Property
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SEI and Simon is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding SEI Investments and Simon Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simon Property Group 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 Simon Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simon Property Group has no effect on the direction of SEI Investments i.e., SEI Investments and Simon Property go up and down completely randomly.
Pair Corralation between SEI Investments and Simon Property
Given the investment horizon of 90 days SEI Investments is expected to generate 1.62 times less return on investment than Simon Property. But when comparing it to its historical volatility, SEI Investments is 1.24 times less risky than Simon Property. It trades about 0.09 of its potential returns per unit of risk. Simon Property Group is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 10,326 in Simon Property Group on September 1, 2024 and sell it today you would earn a total of 8,034 from holding Simon Property Group or generate 77.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEI Investments vs. Simon Property Group
Performance |
| Timeline |
| SEI Investments |
| Simon Property Group |
SEI Investments and Simon Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEI Investments and Simon Property
The main advantage of trading using opposite SEI Investments and Simon Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI Investments position performs unexpectedly, Simon Property 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 Simon Property will offset losses from the drop in Simon Property's long position.| SEI Investments vs. Visa Class A | SEI Investments vs. Diamond Hill Investment | SEI Investments vs. Distoken Acquisition | SEI Investments vs. Associated Capital Group |
| Simon Property vs. Federal Realty Investment | Simon Property vs. National Retail Properties | Simon Property vs. Kimco Realty | Simon Property vs. Acadia Realty Trust |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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