Correlation Between ScanTech and Sea

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

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

Diversification Opportunities for ScanTech and Sea

-0.81

Correlation Coefficient

ScanTech  Sea

Pay attention - limited upside

The 3 months correlation between ScanTech and Sea is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding ScanTech AI Systems and Sea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sea and ScanTech 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 ScanTech AI Systems are associated (or correlated) with Sea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sea has no effect on the direction of ScanTech i.e., ScanTech and Sea go up and down completely randomly.

Pair Corralation between ScanTech and Sea

Given the investment horizon of 90 days ScanTech AI Systems is expected to under-perform the Sea. In addition to that, ScanTech is 2.0 times more volatile than Sea. It trades about -0.27 of its total potential returns per unit of risk. Sea is currently generating about 0.15 per unit of volatility. If you would invest  12,423  in Sea on April 24, 2025 and sell it today you would earn a total of  3,059  from holding Sea or generate 24.62% return on investment over 90 days.

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

ScanTech AI Systems  vs.  Sea

ScanTech AI Systems

Risk-Adjusted Performance

Very Weak

Over the last 90 days ScanTech AI Systems 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 fairly strong which may send shares a bit higher in August 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Sea

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Sea are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent technical and fundamental indicators, Sea exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ScanTech and Sea

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

The idea behind ScanTech AI Systems and Sea 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.