Correlation Between SEI INVESTMENTS and Canadian Utilities
Can any of the company-specific risk be diversified away by investing in both SEI INVESTMENTS and Canadian Utilities 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 Canadian Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI INVESTMENTS and Canadian Utilities Limited, you can compare the effects of market volatilities on SEI INVESTMENTS and Canadian Utilities 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 Canadian Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI INVESTMENTS and Canadian Utilities.
Diversification Opportunities for SEI INVESTMENTS and Canadian Utilities
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SEI and Canadian is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding SEI INVESTMENTS and Canadian Utilities Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Utilities 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 Canadian Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Utilities has no effect on the direction of SEI INVESTMENTS i.e., SEI INVESTMENTS and Canadian Utilities go up and down completely randomly.
Pair Corralation between SEI INVESTMENTS and Canadian Utilities
Assuming the 90 days trading horizon SEI INVESTMENTS is expected to generate 0.74 times more return on investment than Canadian Utilities. However, SEI INVESTMENTS is 1.36 times less risky than Canadian Utilities. It trades about 0.08 of its potential returns per unit of risk. Canadian Utilities Limited is currently generating about 0.02 per unit of risk. If you would invest 5,624 in SEI INVESTMENTS on September 3, 2024 and sell it today you would earn a total of 2,176 from holding SEI INVESTMENTS or generate 38.69% 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. Canadian Utilities Limited
Performance |
| Timeline |
| SEI INVESTMENTS |
| Canadian Utilities |
SEI INVESTMENTS and Canadian Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEI INVESTMENTS and Canadian Utilities
The main advantage of trading using opposite SEI INVESTMENTS and Canadian Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI INVESTMENTS position performs unexpectedly, Canadian Utilities 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 Canadian Utilities will offset losses from the drop in Canadian Utilities' long position.| SEI INVESTMENTS vs. TIANDE CHEMICAL | SEI INVESTMENTS vs. CHEMICAL INDUSTRIES | SEI INVESTMENTS vs. Grupo Carso SAB | SEI INVESTMENTS vs. GRUPO CARSO A1 |
| Canadian Utilities vs. MAVEN WIRELESS SWEDEN | Canadian Utilities vs. Citic Telecom International | Canadian Utilities vs. Tower One Wireless | Canadian Utilities vs. Chunghwa Telecom Co |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |