Correlation Between Stifel Financial and Stifel Financial

Can any of the company-specific risk be diversified away by investing in both Stifel Financial and Stifel Financial 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 Stifel Financial 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 Stifel Financial Corp, you can compare the effects of market volatilities on Stifel Financial and Stifel Financial 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 Stifel Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stifel Financial and Stifel Financial.

Diversification Opportunities for Stifel Financial and Stifel Financial

0.16

Correlation Coefficient

Stifel Financial  Stifel Financial

Average diversification

The 3 months correlation between Stifel and Stifel is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Stifel Financial Corp and Stifel Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stifel Financial Corp 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 Stifel Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stifel Financial Corp has no effect on the direction of Stifel Financial i.e., Stifel Financial and Stifel Financial go up and down completely randomly.

Pair Corralation between Stifel Financial and Stifel Financial

Assuming the 90 days horizon Stifel Financial Corp is expected to under-perform the Stifel Financial. But the preferred stock apears to be less risky and, when comparing its historical volatility, Stifel Financial Corp is 1.5 times less risky than Stifel Financial. The preferred stock trades about -0.04 of its potential returns per unit of risk. The Stifel Financial Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  1,740  in Stifel Financial Corp on December 29, 2024 and sell it today you would earn a total of  2.00  from holding Stifel Financial Corp or generate 0.11% return on investment over 90 days.

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

Stifel Financial Corp  vs.  Stifel Financial Corp

Stifel Financial Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Stifel Financial Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Stifel Financial is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Stifel Financial Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Stifel Financial Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Stifel Financial is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Stifel Financial and Stifel Financial

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

The idea behind Stifel Financial Corp and Stifel Financial Corp 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.