Correlation Between SEI INVESTMENTS and Shimano

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

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

Diversification Opportunities for SEI INVESTMENTS and Shimano

-0.22

Correlation Coefficient

SEI INVESTMENTS  Shimano

Very good diversification

The 3 months correlation between SEI and Shimano is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding SEI INVESTMENTS and Shimano in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shimano 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 Shimano. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shimano has no effect on the direction of SEI INVESTMENTS i.e., SEI INVESTMENTS and Shimano go up and down completely randomly.

Pair Corralation between SEI INVESTMENTS and Shimano

Assuming the 90 days trading horizon SEI INVESTMENTS is expected to under-perform the Shimano. But the stock apears to be less risky and, when comparing its historical volatility, SEI INVESTMENTS is 1.28 times less risky than Shimano. The stock trades about -0.17 of its potential returns per unit of risk. The Shimano is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  12,850  in Shimano on December 20, 2024 and sell it today you would earn a total of  610.00  from holding Shimano or generate 4.75% return on investment over 90 days.

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

SEI INVESTMENTS  vs.  Shimano

SEI INVESTMENTS

Risk-Adjusted Performance

Very Weak

Over the last 90 days SEI INVESTMENTS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Shimano

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Shimano are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Shimano is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SEI INVESTMENTS and Shimano

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

The idea behind SEI INVESTMENTS and Shimano 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.