Correlation Between SEI Investments and U Power
Can any of the company-specific risk be diversified away by investing in both SEI Investments and U Power 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 U Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI Investments and U Power Limited, you can compare the effects of market volatilities on SEI Investments and U Power 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 U Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI Investments and U Power.
Diversification Opportunities for SEI Investments and U Power
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SEI and UCAR is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding SEI Investments and U Power Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Power Limited 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 U Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Power Limited has no effect on the direction of SEI Investments i.e., SEI Investments and U Power go up and down completely randomly.
Pair Corralation between SEI Investments and U Power
Given the investment horizon of 90 days SEI Investments is expected to generate 0.25 times more return on investment than U Power. However, SEI Investments is 3.99 times less risky than U Power. It trades about 0.4 of its potential returns per unit of risk. U Power Limited is currently generating about -0.22 per unit of risk. If you would invest 7,476 in SEI Investments on September 1, 2024 and sell it today you would earn a total of 787.00 from holding SEI Investments or generate 10.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEI Investments vs. U Power Limited
Performance |
| Timeline |
| SEI Investments |
| U Power Limited |
SEI Investments and U Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEI Investments and U Power
The main advantage of trading using opposite SEI Investments and U Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI Investments position performs unexpectedly, U Power 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 U Power will offset losses from the drop in U Power'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 |
| U Power vs. Advance Auto Parts | U Power vs. Tractor Supply | U Power vs. Genuine Parts Co | U Power vs. Five Below |
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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