Correlation Between SEI INVESTMENTS and Jernimo Martins
Can any of the company-specific risk be diversified away by investing in both SEI INVESTMENTS and Jernimo Martins 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 Jernimo Martins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI INVESTMENTS and Jernimo Martins SGPS, you can compare the effects of market volatilities on SEI INVESTMENTS and Jernimo Martins 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 Jernimo Martins. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI INVESTMENTS and Jernimo Martins.
Diversification Opportunities for SEI INVESTMENTS and Jernimo Martins
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SEI and Jernimo is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding SEI INVESTMENTS and Jernimo Martins SGPS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jernimo Martins SGPS 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 Jernimo Martins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jernimo Martins SGPS has no effect on the direction of SEI INVESTMENTS i.e., SEI INVESTMENTS and Jernimo Martins go up and down completely randomly.
Pair Corralation between SEI INVESTMENTS and Jernimo Martins
Assuming the 90 days trading horizon SEI INVESTMENTS is expected to generate 0.5 times more return on investment than Jernimo Martins. However, SEI INVESTMENTS is 1.99 times less risky than Jernimo Martins. It trades about 0.1 of its potential returns per unit of risk. Jernimo Martins SGPS is currently generating about 0.01 per unit of risk. If you would invest 5,373 in SEI INVESTMENTS on September 20, 2024 and sell it today you would earn a total of 2,777 from holding SEI INVESTMENTS or generate 51.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEI INVESTMENTS vs. Jernimo Martins SGPS
Performance |
| Timeline |
| SEI INVESTMENTS |
| Jernimo Martins SGPS |
SEI INVESTMENTS and Jernimo Martins Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEI INVESTMENTS and Jernimo Martins
The main advantage of trading using opposite SEI INVESTMENTS and Jernimo Martins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI INVESTMENTS position performs unexpectedly, Jernimo Martins 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 Jernimo Martins will offset losses from the drop in Jernimo Martins' long position.| SEI INVESTMENTS vs. EEDUCATION ALBERT AB | SEI INVESTMENTS vs. XLMedia PLC | SEI INVESTMENTS vs. DeVry Education Group | SEI INVESTMENTS vs. Ubisoft Entertainment SA |
| Jernimo Martins vs. Metro AG | Jernimo Martins vs. Superior Plus Corp | Jernimo Martins vs. SIVERS SEMICONDUCTORS AB | Jernimo Martins vs. NorAm Drilling AS |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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