Correlation Between SEI INVESTMENTS and Thai Oil

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Can any of the company-specific risk be diversified away by investing in both SEI INVESTMENTS and Thai Oil 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 Thai Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI INVESTMENTS and Thai Oil Public, you can compare the effects of market volatilities on SEI INVESTMENTS and Thai Oil 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 Thai Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI INVESTMENTS and Thai Oil.

Diversification Opportunities for SEI INVESTMENTS and Thai Oil

-0.95
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between SEI and Thai is -0.95. Overlapping area represents the amount of risk that can be diversified away by holding SEI INVESTMENTS and Thai Oil Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Oil Public 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 Thai Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Oil Public has no effect on the direction of SEI INVESTMENTS i.e., SEI INVESTMENTS and Thai Oil go up and down completely randomly.

Pair Corralation between SEI INVESTMENTS and Thai Oil

Assuming the 90 days trading horizon SEI INVESTMENTS is expected to generate 0.24 times more return on investment than Thai Oil. However, SEI INVESTMENTS is 4.2 times less risky than Thai Oil. It trades about 0.57 of its potential returns per unit of risk. Thai Oil Public is currently generating about -0.05 per unit of risk. If you would invest  7,350  in SEI INVESTMENTS on September 12, 2024 and sell it today you would earn a total of  650.00  from holding SEI INVESTMENTS or generate 8.84% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

SEI INVESTMENTS  vs.  Thai Oil Public

 Performance 
       Timeline  
SEI INVESTMENTS 

Risk-Adjusted Performance

28 of 100

 
Weak
 
Strong
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in SEI INVESTMENTS are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, SEI INVESTMENTS unveiled solid returns over the last few months and may actually be approaching a breakup point.
Thai Oil Public 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Thai Oil Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

SEI INVESTMENTS and Thai Oil Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SEI INVESTMENTS and Thai Oil

The main advantage of trading using opposite SEI INVESTMENTS and Thai Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI INVESTMENTS position performs unexpectedly, Thai Oil 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 Thai Oil will offset losses from the drop in Thai Oil's long position.
The idea behind SEI INVESTMENTS and Thai Oil Public pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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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