Robinhood Markets Stock Volatility
| HOOD Stock | USD 44.36 0.70 1.60% |
Robinhood Markets appears to be not too volatile, given 3 months investment horizon. Robinhood Markets maintains Sharpe Ratio (i.e., Efficiency) of 0.0789, which implies the firm had a 0.0789 % return per unit of risk over the last 3 months. We have found twenty-nine technical indicators for Robinhood Markets, which you can use to evaluate the volatility of the company. Please evaluate Robinhood Markets' Coefficient Of Variation of 1766.7, risk adjusted performance of 0.0586, and Semi Deviation of 6.0 to confirm if our risk estimates are consistent with your expectations. Key indicators related to Robinhood Markets' volatility include:
90 Days Market Risk | Chance Of Distress | 90 Days Economic Sensitivity |
Robinhood Markets Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Robinhood daily returns, and it is calculated using variance and standard deviation. We also use Robinhood's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Robinhood Markets volatility.
Robinhood |
ESG Sustainability
While most ESG disclosures are voluntary, Robinhood Markets' sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Robinhood Markets' managers and investors.Environmental | Governance | Social |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Robinhood Markets can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game as hey may decide to buy additional stocks of Robinhood Markets at lower prices to lower their average cost per share. Similarly, when the prices of Robinhood Markets' stock rise, investors can sell out and invest the proceeds in other equities with better opportunities.
Moving together with Robinhood Stock
Moving against Robinhood Stock
Robinhood Markets Market Sensitivity And Downside Risk
Robinhood Markets' beta coefficient measures the volatility of Robinhood stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Robinhood stock's returns against your selected market. In other words, Robinhood Markets's beta of 3.1 provides an investor with an approximation of how much risk Robinhood Markets stock can potentially add to one of your existing portfolios. Robinhood Markets exhibits above-average semi-deviation for your current time horizon. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Robinhood Markets' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Robinhood Markets' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Robinhood Markets Demand TrendCheck current 90 days Robinhood Markets correlation with market (Dow Jones Industrial)Robinhood Beta |
Robinhood standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 5.47 |
It is essential to understand the difference between upside risk (as represented by Robinhood Markets's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Robinhood Markets' daily returns or price. Since the actual investment returns on holding a position in robinhood stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Robinhood Markets.
Using Robinhood Put Option to Manage Risk
Put options written on Robinhood Markets grant holders of the option the right to sell a specified amount of Robinhood Markets at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Robinhood Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Robinhood Markets' position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Robinhood Markets will be realized, the loss incurred will be offset by the profits made with the option trade.
Robinhood Markets' PUT expiring on 2025-06-20
Profit |
| Robinhood Markets Price At Expiration |
Current Robinhood Markets Insurance Chain
| Delta | Gamma | Open Int | Expiration | Current Spread | Last Price | |||
Put | HOOD250620P00003000 | -0.003794 | 1.92E-4 | 20 | 2025-06-20 | 0.0 - 0.22 | 0.0 | View |
Put | HOOD250620P00005000 | -0.00513 | 3.16E-4 | 52 | 2025-06-20 | 0.0 - 0.22 | 0.0 | View |
Put | HOOD250620P00010000 | -0.014619 | 0.001005 | 218 | 2025-06-20 | 0.0 - 0.52 | 0.0 | View |
Put | HOOD250620P00012000 | -0.019715 | 0.001406 | 724 | 2025-06-20 | 0.0 - 0.66 | 0.0 | View |
Put | HOOD250620P00013000 | -0.021713 | 0.001606 | 2213 | 2025-06-20 | 0.05 - 0.64 | 0.0 | View |
Put | HOOD250620P00014000 | -0.014219 | 0.001363 | 591 | 2025-06-20 | 0.0 - 0.33 | 0.0 | View |
Put | HOOD250620P00015000 | -0.012456 | 0.001349 | 2885 | 2025-06-20 | 0.0 - 0.25 | 0.0 | View |
Put | HOOD250620P00016000 | -0.018674 | 0.001858 | 50 | 2025-06-20 | 0.0 - 0.41 | 0.0 | View |
Put | HOOD250620P00017000 | -0.024123 | 0.002309 | 26 | 2025-06-20 | 0.0 - 0.55 | 0.0 | View |
Put | HOOD250620P00018000 | -0.02435 | 0.002498 | 606 | 2025-06-20 | 0.0 - 0.51 | 0.0 | View |
Put | HOOD250620P00019000 | -0.027453 | 0.002867 | 132 | 2025-06-20 | 0.03 - 0.53 | 0.0 | View |
Robinhood Markets Stock Volatility Analysis
Volatility refers to the frequency at which Robinhood Markets stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Robinhood Markets' price changes. Investors will then calculate the volatility of Robinhood Markets' stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Robinhood Markets' volatility:
Historical Volatility
This type of stock volatility measures Robinhood Markets' fluctuations based on previous trends. It's commonly used to predict Robinhood Markets' future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Robinhood Markets' current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Robinhood Markets' to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Robinhood Markets Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Robinhood Markets Projected Return Density Against Market
Given the investment horizon of 90 days the stock has the beta coefficient of 3.1045 . This usually indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Robinhood Markets will likely underperform.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Robinhood Markets or Capital Markets sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Robinhood Markets' price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Robinhood stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Robinhood Markets has an alpha of 0.5267, implying that it can generate a 0.53 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta). Predicted Return Density |
| Returns |
What Drives a Robinhood Markets Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Robinhood Markets Stock Risk Measures
Given the investment horizon of 90 days the coefficient of variation of Robinhood Markets is 1267.4. The daily returns are distributed with a variance of 29.87 and standard deviation of 5.47. The mean deviation of Robinhood Markets is currently at 4.16. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.89
α | Alpha over Dow Jones | 0.53 | |
β | Beta against Dow Jones | 3.10 | |
σ | Overall volatility | 5.47 | |
Ir | Information ratio | 0.07 |
Robinhood Markets Stock Return Volatility
Robinhood Markets historical daily return volatility represents how much of Robinhood Markets stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm inherits 5.4657% risk (volatility on return distribution) over the 90 days horizon. By contrast, Dow Jones Industrial accepts 0.8446% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Robinhood Markets Volatility
Volatility is a rate at which the price of Robinhood Markets or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Robinhood Markets may increase or decrease. In other words, similar to Robinhood's beta indicator, it measures the risk of Robinhood Markets and helps estimate the fluctuations that may happen in a short period of time. So if prices of Robinhood Markets fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.| Last Reported | Projected for Next Year | ||
| Selling And Marketing Expenses | 272 M | 207.9 M | |
| Market Cap | 32.8 B | 23.1 B |
Robinhood Markets' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Robinhood Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Robinhood Markets' price varies over time.
3 ways to utilize Robinhood Markets' volatility to invest better
Higher Robinhood Markets' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Robinhood Markets stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Robinhood Markets stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Robinhood Markets investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Robinhood Markets' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Robinhood Markets' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Robinhood Markets Investment Opportunity
Robinhood Markets has a volatility of 5.47 and is 6.51 times more volatile than Dow Jones Industrial. Compared to the overall equity markets, volatility of historical daily returns of Robinhood Markets is lower than 48 percent of all global equities and portfolios over the last 90 days. You can use Robinhood Markets to enhance the returns of your portfolios. The stock experiences a large bullish trend. Check odds of Robinhood Markets to be traded at $48.8 in 90 days.Very weak diversification
The correlation between Robinhood Markets and DJI is 0.5 (i.e., Very weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Robinhood Markets and DJI in the same portfolio, assuming nothing else is changed.
Robinhood Markets Additional Risk Indicators
The analysis of Robinhood Markets' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Robinhood Markets' investment and either accepting that risk or mitigating it. Along with some common measures of Robinhood Markets stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0586 | |||
| Market Risk Adjusted Performance | 0.1073 | |||
| Mean Deviation | 4.24 | |||
| Semi Deviation | 6.0 | |||
| Downside Deviation | 6.13 | |||
| Coefficient Of Variation | 1766.7 | |||
| Standard Deviation | 5.51 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Robinhood Markets Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Robinhood Markets as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Robinhood Markets' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Robinhood Markets' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Robinhood Markets.
Complementary Tools for Robinhood Stock analysis
When running Robinhood Markets' price analysis, check to measure Robinhood Markets' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Robinhood Markets is operating at the current time. Most of Robinhood Markets' value examination focuses on studying past and present price action to predict the probability of Robinhood Markets' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Robinhood Markets' price. Additionally, you may evaluate how the addition of Robinhood Markets to your portfolios can decrease your overall portfolio volatility.
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