Correlation Between SEI INVESTMENTS and Stanley Black
Can any of the company-specific risk be diversified away by investing in both SEI INVESTMENTS and Stanley Black 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 Stanley Black into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEI INVESTMENTS and Stanley Black Decker, you can compare the effects of market volatilities on SEI INVESTMENTS and Stanley Black 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 Stanley Black. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI INVESTMENTS and Stanley Black.
Diversification Opportunities for SEI INVESTMENTS and Stanley Black
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SEI and Stanley is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding SEI INVESTMENTS and Stanley Black Decker in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stanley Black Decker 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 Stanley Black. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stanley Black Decker has no effect on the direction of SEI INVESTMENTS i.e., SEI INVESTMENTS and Stanley Black go up and down completely randomly.
Pair Corralation between SEI INVESTMENTS and Stanley Black
Assuming the 90 days trading horizon SEI INVESTMENTS is expected to generate 0.58 times more return on investment than Stanley Black. However, SEI INVESTMENTS is 1.72 times less risky than Stanley Black. It trades about 0.18 of its potential returns per unit of risk. Stanley Black Decker is currently generating about 0.03 per unit of risk. If you would invest 6,050 in SEI INVESTMENTS on September 13, 2024 and sell it today you would earn a total of 1,950 from holding SEI INVESTMENTS or generate 32.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEI INVESTMENTS vs. Stanley Black Decker
Performance |
| Timeline |
| SEI INVESTMENTS |
| Stanley Black Decker |
SEI INVESTMENTS and Stanley Black Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEI INVESTMENTS and Stanley Black
The main advantage of trading using opposite SEI INVESTMENTS and Stanley Black positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEI INVESTMENTS position performs unexpectedly, Stanley Black 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 Stanley Black will offset losses from the drop in Stanley Black's long position.| SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Apple Inc | SEI INVESTMENTS vs. Apple Inc |
| Stanley Black vs. Techtronic Industries | Stanley Black vs. Snap on Incorporated | Stanley Black vs. Toro Co | Stanley Black vs. Lincoln Electric Holdings |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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