Correlation Between Stifel Financial and Perella Weinberg

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

By analyzing existing cross correlation between Stifel Financial Corp and Perella Weinberg Partners, you can compare the effects of market volatilities on Stifel Financial and Perella Weinberg 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 Stifel Financial with a short position of Perella Weinberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stifel Financial and Perella Weinberg.

Diversification Opportunities for Stifel Financial and Perella Weinberg

-0.3

Correlation Coefficient

Stifel Financial  Perella Weinberg

Very good diversification

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

Pair Corralation between Stifel Financial and Perella Weinberg

Assuming the 90 days horizon Stifel Financial Corp is expected to generate 0.21 times more return on investment than Perella Weinberg. However, Stifel Financial Corp is 4.75 times less risky than Perella Weinberg. It trades about 0.04 of its potential returns per unit of risk. Perella Weinberg Partners is currently generating about -0.12 per unit of risk. If you would invest  2,421  in Stifel Financial Corp on December 29, 2024 and sell it today you would earn a total of  30.00  from holding Stifel Financial Corp or generate 1.24% return on investment over 90 days.

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

Stifel Financial Corp  vs.  Perella Weinberg Partners

Stifel Financial Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Stifel Financial Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Stifel Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Perella Weinberg Partners

Risk-Adjusted Performance

Very Weak

Over the last 90 days Perella Weinberg Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Stifel Financial and Perella Weinberg

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

The idea behind Stifel Financial Corp and Perella Weinberg Partners 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.

Check out your portfolio center.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.