Correlation Between Sea and CDT Environmental

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

By analyzing existing cross correlation between Sea and CDT Environmental Technology, you can compare the effects of market volatilities on Sea and CDT Environmental 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 Sea with a short position of CDT Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sea and CDT Environmental.

Diversification Opportunities for Sea and CDT Environmental

-0.09

Correlation Coefficient

Sea  CDT Environmental

Good diversification

The 3 months correlation between Sea and CDT is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Sea and CDT Environmental Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDT Environmental and Sea 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 Sea are associated (or correlated) with CDT Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDT Environmental has no effect on the direction of Sea i.e., Sea and CDT Environmental go up and down completely randomly.

Pair Corralation between Sea and CDT Environmental

Allowing for the 90-day total investment horizon Sea is expected to generate 2.3 times less return on investment than CDT Environmental. But when comparing it to its historical volatility, Sea is 3.85 times less risky than CDT Environmental. It trades about 0.06 of its potential returns per unit of risk. CDT Environmental Technology is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  70.00  in CDT Environmental Technology on May 5, 2025 and sell it today you would lose (2.00) from holding CDT Environmental Technology or give up 2.86% of portfolio value over 90 days.

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

Sea  vs.  CDT Environmental Technology

Sea

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Sea are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent technical and fundamental indicators, Sea may actually be approaching a critical reversion point that can send shares even higher in September 2025.

CDT Environmental

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CDT Environmental Technology are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, CDT Environmental reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sea and CDT Environmental

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

The idea behind Sea and CDT Environmental Technology 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.