Correlation Between SEI Investments and Hamilton Insurance

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

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

Diversification Opportunities for SEI Investments and Hamilton Insurance

-0.3

Correlation Coefficient

SEI Investments  Hamilton Insurance

Very good diversification

The 3 months correlation between SEI and Hamilton is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding SEI Investments and Hamilton Insurance Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Insurance Group, 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 Hamilton Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Insurance Group, has no effect on the direction of SEI Investments i.e., SEI Investments and Hamilton Insurance go up and down completely randomly.

Pair Corralation between SEI Investments and Hamilton Insurance

Given the investment horizon of 90 days SEI Investments is expected to generate 0.56 times more return on investment than Hamilton Insurance. However, SEI Investments is 1.8 times less risky than Hamilton Insurance. It trades about 0.28 of its potential returns per unit of risk. Hamilton Insurance Group, is currently generating about 0.0 per unit of risk. If you would invest  6,727  in SEI Investments on September 2, 2024 and sell it today you would earn a total of  1,536  from holding SEI Investments or generate 22.83% 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.  Hamilton Insurance Group,

SEI Investments

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SEI Investments are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal forward indicators, SEI Investments exhibited solid returns over the last few months and may actually be approaching a breakup point.

Hamilton Insurance Group,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hamilton Insurance Group, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, Hamilton Insurance 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 Hamilton Insurance

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

The idea behind SEI Investments and Hamilton Insurance Group, 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.