Correlation Between SEI Investments and US Global

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

By analyzing existing cross correlation between SEI Investments and US Global Investors, you can compare the effects of market volatilities on SEI Investments and US Global 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 US Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEI Investments and US Global.

Diversification Opportunities for SEI Investments and US Global

-0.58

Correlation Coefficient

SEI Investments  US Global

Excellent diversification

The 3 months correlation between SEI and GROW is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding SEI Investments and US Global Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Global Investors 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 US Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Global Investors has no effect on the direction of SEI Investments i.e., SEI Investments and US Global go up and down completely randomly.

Pair Corralation between SEI Investments and US Global

Given the investment horizon of 90 days SEI Investments is expected to generate 1.21 times more return on investment than US Global. However, SEI Investments is 1.21 times more volatile than US Global Investors. It trades about 0.25 of its potential returns per unit of risk. US Global Investors is currently generating about 0.03 per unit of risk. If you would invest  7,070  in SEI Investments on September 23, 2024 and sell it today you would earn a total of  1,205  from holding SEI Investments or generate 17.04% return on investment over 90 days.

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

SEI Investments  vs.  US Global Investors

SEI Investments

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SEI Investments are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent forward indicators, SEI Investments exhibited solid returns over the last few months and may actually be approaching a breakup point.

US Global Investors

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days US Global Investors has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, US Global is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with SEI Investments and US Global

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

The idea behind SEI Investments and US Global Investors 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.