Correlation Between SEI Investments and Fidelity® Government

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

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

Diversification Opportunities for SEI Investments and Fidelity® Government

0.0

Correlation Coefficient

SEI Investments  Fidelity® Government

Pay attention - limited upside

The 3 months correlation between SEI and Fidelity® is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SEI Investments and Fidelity Government Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Government Money 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 Fidelity® Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Government Money has no effect on the direction of SEI Investments i.e., SEI Investments and Fidelity® Government go up and down completely randomly.

Pair Corralation between SEI Investments and Fidelity® Government

If you would invest  7,633  in SEI Investments on October 6, 2024 and sell it today you would earn a total of  557.00  from holding SEI Investments or generate 7.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	97.56%
Values	Daily Returns

SEI Investments  vs.  Fidelity Government Money

SEI Investments

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SEI Investments are ranked lower than 15 (%) 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.

Fidelity Government Money

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fidelity Government Money has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Fidelity® Government is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SEI Investments and Fidelity® Government

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

The idea behind SEI Investments and Fidelity Government Money 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.

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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.