Correlation Between Stanley Electric and SEI INVESTMENTS
Can any of the company-specific risk be diversified away by investing in both Stanley Electric and SEI INVESTMENTS 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 Stanley Electric and SEI INVESTMENTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stanley Electric Co and SEI INVESTMENTS, you can compare the effects of market volatilities on Stanley Electric and SEI INVESTMENTS 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 Stanley Electric with a short position of SEI INVESTMENTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stanley Electric and SEI INVESTMENTS.
Diversification Opportunities for Stanley Electric and SEI INVESTMENTS
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Stanley and SEI is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Stanley Electric Co and SEI INVESTMENTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI INVESTMENTS and Stanley Electric 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 Stanley Electric Co are associated (or correlated) with SEI INVESTMENTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEI INVESTMENTS has no effect on the direction of Stanley Electric i.e., Stanley Electric and SEI INVESTMENTS go up and down completely randomly.
Pair Corralation between Stanley Electric and SEI INVESTMENTS
Assuming the 90 days trading horizon Stanley Electric Co is expected to under-perform the SEI INVESTMENTS. In addition to that, Stanley Electric is 1.05 times more volatile than SEI INVESTMENTS. It trades about -0.15 of its total potential returns per unit of risk. SEI INVESTMENTS is currently generating about 0.1 per unit of volatility. If you would invest 7,750 in SEI INVESTMENTS on September 25, 2024 and sell it today you would earn a total of 200.00 from holding SEI INVESTMENTS or generate 2.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stanley Electric Co vs. SEI INVESTMENTS
Performance |
| Timeline |
| Stanley Electric |
| SEI INVESTMENTS |
Stanley Electric and SEI INVESTMENTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stanley Electric and SEI INVESTMENTS
The main advantage of trading using opposite Stanley Electric and SEI INVESTMENTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stanley Electric position performs unexpectedly, SEI INVESTMENTS 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 SEI INVESTMENTS will offset losses from the drop in SEI INVESTMENTS's long position.| Stanley Electric vs. SEI INVESTMENTS | Stanley Electric vs. PennantPark Investment | Stanley Electric vs. REINET INVESTMENTS SCA | Stanley Electric vs. REGAL ASIAN INVESTMENTS |
| SEI INVESTMENTS vs. SLR Investment Corp | SEI INVESTMENTS vs. FAST RETAIL ADR | SEI INVESTMENTS vs. Apollo Investment Corp | SEI INVESTMENTS vs. TRADEDOUBLER AB SK |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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