Correlation Between Proficient Auto and Sea

Can any of the company-specific risk be diversified away by investing in both Proficient Auto and Sea 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 Proficient Auto and Sea into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Proficient Auto Logistics, and Sea, you can compare the effects of market volatilities on Proficient Auto and Sea 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 Proficient Auto with a short position of Sea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Proficient Auto and Sea.

Diversification Opportunities for Proficient Auto and Sea

0.54

Correlation Coefficient

Proficient Auto  Sea

Very weak diversification

The 3 months correlation between Proficient and Sea is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Proficient Auto Logistics, and Sea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sea and Proficient Auto 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 Proficient Auto Logistics, are associated (or correlated) with Sea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sea has no effect on the direction of Proficient Auto i.e., Proficient Auto and Sea go up and down completely randomly.

Pair Corralation between Proficient Auto and Sea

Considering the 90-day investment horizon Proficient Auto is expected to generate 1.04 times less return on investment than Sea. In addition to that, Proficient Auto is 1.91 times more volatile than Sea. It trades about 0.07 of its total potential returns per unit of risk. Sea is currently generating about 0.14 per unit of volatility. If you would invest  10,748  in Sea on December 28, 2024 and sell it today you would earn a total of  2,609  from holding Sea or generate 24.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Proficient Auto Logistics,  vs.  Sea

Proficient Auto Logi

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Proficient Auto Logistics, are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Proficient Auto disclosed solid returns over the last few months and may actually be approaching a breakup point.

Sea

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sea are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Sea exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Proficient Auto and Sea

The main advantage of trading using opposite Proficient Auto and Sea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Proficient Auto position performs unexpectedly, Sea 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 Sea will offset losses from the drop in Sea's long position.

The idea behind Proficient Auto Logistics, and Sea 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.