Correlation Between U Power and SEI Investments
Can any of the company-specific risk be diversified away by investing in both U Power 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 U Power and SEI Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between U Power Limited and SEI Investments, you can compare the effects of market volatilities on U Power 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 U Power with a short position of SEI Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Power and SEI Investments.
Diversification Opportunities for U Power and SEI Investments
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between UCAR and SEI is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding U Power Limited and SEI Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI Investments and U Power 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 U Power Limited 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 U Power i.e., U Power and SEI Investments go up and down completely randomly.
Pair Corralation between U Power and SEI Investments
Given the investment horizon of 90 days U Power Limited is expected to under-perform the SEI Investments. In addition to that, U Power is 3.99 times more volatile than SEI Investments. It trades about -0.22 of its total potential returns per unit of risk. SEI Investments is currently generating about 0.4 per unit of volatility. If you would invest 7,476 in SEI Investments on September 1, 2024 and sell it today you would earn a total of 787.00 from holding SEI Investments or generate 10.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
U Power Limited vs. SEI Investments
Performance |
| Timeline |
| U Power Limited |
| SEI Investments |
U Power and SEI Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with U Power and SEI Investments
The main advantage of trading using opposite U Power and SEI Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if U Power 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' long position.| U Power vs. Advance Auto Parts | U Power vs. Tractor Supply | U Power vs. Genuine Parts Co | U Power vs. Five Below |
| SEI Investments vs. Visa Class A | SEI Investments vs. Diamond Hill Investment | SEI Investments vs. Distoken Acquisition | SEI Investments vs. Associated Capital Group |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |