Correlation Between SEI INVESTMENTS and PENN Entertainment
Can any of the company-specific risk be diversified away by investing in both SEI INVESTMENTS and PENN Entertainment 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 PENN Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI INVESTMENTS and PENN Entertainment, you can compare the effects of market volatilities on SEI INVESTMENTS and PENN Entertainment 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 PENN Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI INVESTMENTS and PENN Entertainment.
Diversification Opportunities for SEI INVESTMENTS and PENN Entertainment
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SEI and PENN is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding SEI INVESTMENTS and PENN Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PENN Entertainment 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 PENN Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PENN Entertainment has no effect on the direction of SEI INVESTMENTS i.e., SEI INVESTMENTS and PENN Entertainment go up and down completely randomly.
Pair Corralation between SEI INVESTMENTS and PENN Entertainment
Assuming the 90 days trading horizon SEI INVESTMENTS is expected to generate 1.88 times less return on investment than PENN Entertainment. But when comparing it to its historical volatility, SEI INVESTMENTS is 2.13 times less risky than PENN Entertainment. It trades about 0.05 of its potential returns per unit of risk. PENN Entertainment is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,777 in PENN Entertainment on October 11, 2024 and sell it today you would earn a total of 33.00 from holding PENN Entertainment or generate 1.86% 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. PENN Entertainment
Performance |
| Timeline |
| SEI INVESTMENTS |
| PENN Entertainment |
SEI INVESTMENTS and PENN Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEI INVESTMENTS and PENN Entertainment
The main advantage of trading using opposite SEI INVESTMENTS and PENN Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI INVESTMENTS position performs unexpectedly, PENN Entertainment 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 PENN Entertainment will offset losses from the drop in PENN Entertainment's long position.| SEI INVESTMENTS vs. GOODYEAR T RUBBER | SEI INVESTMENTS vs. NORTHEAST UTILITIES | SEI INVESTMENTS vs. Cal Maine Foods | SEI INVESTMENTS vs. Performance Food Group |
| PENN Entertainment vs. PARKEN Sport Entertainment | PENN Entertainment vs. SEI INVESTMENTS | PENN Entertainment vs. Japan Asia Investment | PENN Entertainment vs. WisdomTree Investments |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |