Correlation Between SEI INVESTMENTS and BRIT AMER
Can any of the company-specific risk be diversified away by investing in both SEI INVESTMENTS and BRIT AMER 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 BRIT AMER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI INVESTMENTS and BRIT AMER TOBACCO, you can compare the effects of market volatilities on SEI INVESTMENTS and BRIT AMER 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 BRIT AMER. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI INVESTMENTS and BRIT AMER.
Diversification Opportunities for SEI INVESTMENTS and BRIT AMER
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SEI and BRIT is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding SEI INVESTMENTS and BRIT AMER TOBACCO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRIT AMER TOBACCO 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 BRIT AMER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRIT AMER TOBACCO has no effect on the direction of SEI INVESTMENTS i.e., SEI INVESTMENTS and BRIT AMER go up and down completely randomly.
Pair Corralation between SEI INVESTMENTS and BRIT AMER
Assuming the 90 days trading horizon SEI INVESTMENTS is expected to generate 0.83 times more return on investment than BRIT AMER. However, SEI INVESTMENTS is 1.21 times less risky than BRIT AMER. It trades about 0.12 of its potential returns per unit of risk. BRIT AMER TOBACCO is currently generating about 0.07 per unit of risk. If you would invest 5,317 in SEI INVESTMENTS on September 12, 2024 and sell it today you would earn a total of 2,583 from holding SEI INVESTMENTS or generate 48.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEI INVESTMENTS vs. BRIT AMER TOBACCO
Performance |
| Timeline |
| SEI INVESTMENTS |
| BRIT AMER TOBACCO |
SEI INVESTMENTS and BRIT AMER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEI INVESTMENTS and BRIT AMER
The main advantage of trading using opposite SEI INVESTMENTS and BRIT AMER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI INVESTMENTS position performs unexpectedly, BRIT AMER 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 BRIT AMER will offset losses from the drop in BRIT AMER's long position.| SEI INVESTMENTS vs. BROADSTNET LEADL 00025 | SEI INVESTMENTS vs. Texas Roadhouse | SEI INVESTMENTS vs. OFFICE DEPOT | SEI INVESTMENTS vs. Broadcom |
| BRIT AMER vs. PLAYMATES TOYS | BRIT AMER vs. TSOGO SUN GAMING | BRIT AMER vs. COFCO Joycome Foods | BRIT AMER vs. GigaMedia |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |