Correlation Between Moelis and Raymond James

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

By analyzing existing cross correlation between Moelis Co and Raymond James Financial, you can compare the effects of market volatilities on Moelis and Raymond James 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 Moelis with a short position of Raymond James. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moelis and Raymond James.

Diversification Opportunities for Moelis and Raymond James

0.93

Correlation Coefficient

Moelis  Raymond James

Almost no diversification

The 3 months correlation between Moelis and Raymond is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Moelis Co and Raymond James Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raymond James Financial and Moelis 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 Moelis Co are associated (or correlated) with Raymond James. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raymond James Financial has no effect on the direction of Moelis i.e., Moelis and Raymond James go up and down completely randomly.

Pair Corralation between Moelis and Raymond James

Allowing for the 90-day total investment horizon Moelis Co is expected to under-perform the Raymond James. In addition to that, Moelis is 1.29 times more volatile than Raymond James Financial. It trades about -0.16 of its total potential returns per unit of risk. Raymond James Financial is currently generating about -0.08 per unit of volatility. If you would invest  15,483  in Raymond James Financial on December 28, 2024 and sell it today you would lose (1,219) from holding Raymond James Financial or give up 7.87% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Moelis Co  vs.  Raymond James Financial

Moelis

Risk-Adjusted Performance

Very Weak

Over the last 90 days Moelis Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Raymond James Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Raymond James Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward-looking indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Moelis and Raymond James

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

The idea behind Moelis Co and Raymond James Financial 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.