Correlation Between JIN MEDICAL and SEI Investments

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

By analyzing existing cross correlation between JIN MEDICAL INTERNATIONAL and SEI Investments, you can compare the effects of market volatilities on JIN MEDICAL 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 JIN MEDICAL with a short position of SEI Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of JIN MEDICAL and SEI Investments.

Diversification Opportunities for JIN MEDICAL and SEI Investments

0.26

Correlation Coefficient

JIN MEDICAL  SEI Investments

Modest diversification

The 3 months correlation between JIN and SEI is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding JIN MEDICAL INTERNATIONAL and SEI Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEI Investments and JIN MEDICAL 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 JIN MEDICAL INTERNATIONAL 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 JIN MEDICAL i.e., JIN MEDICAL and SEI Investments go up and down completely randomly.

Pair Corralation between JIN MEDICAL and SEI Investments

Given the investment horizon of 90 days JIN MEDICAL INTERNATIONAL is expected to under-perform the SEI Investments. In addition to that, JIN MEDICAL is 6.8 times more volatile than SEI Investments. It trades about -0.06 of its total potential returns per unit of risk. SEI Investments is currently generating about -0.08 per unit of volatility. If you would invest  8,404  in SEI Investments on December 26, 2024 and sell it today you would lose (533.00) from holding SEI Investments or give up 6.34% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

JIN MEDICAL INTERNATIONAL  vs.  SEI Investments

JIN MEDICAL INTERNATIONAL

Risk-Adjusted Performance

Very Weak

Over the last 90 days JIN MEDICAL INTERNATIONAL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

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 rather sound forward indicators, SEI Investments is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with JIN MEDICAL and SEI Investments

The main advantage of trading using opposite JIN MEDICAL and SEI Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JIN MEDICAL 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.

The idea behind JIN MEDICAL INTERNATIONAL and SEI Investments 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.