Correlation Between Hall Of and Stifel Financial

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

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

Diversification Opportunities for Hall Of and Stifel Financial

-0.02

Correlation Coefficient

Hall Of  Stifel Financial

Good diversification

The 3 months correlation between Hall and Stifel is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Hall of Fame and Stifel Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stifel Financial and Hall Of 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 Hall of Fame 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 has no effect on the direction of Hall Of i.e., Hall Of and Stifel Financial go up and down completely randomly.

Pair Corralation between Hall Of and Stifel Financial

Assuming the 90 days horizon Hall of Fame is expected to generate 21.75 times more return on investment than Stifel Financial. However, Hall Of is 21.75 times more volatile than Stifel Financial. It trades about 0.07 of its potential returns per unit of risk. Stifel Financial is currently generating about -0.15 per unit of risk. If you would invest  1.09  in Hall of Fame on March 19, 2024 and sell it today you would lose (0.29) from holding Hall of Fame or give up 26.61% of portfolio value over 90 days.

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

Hall of Fame  vs.  Stifel Financial

Hall of Fame

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hall of Fame are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Hall Of showed solid returns over the last few months and may actually be approaching a breakup point.

Stifel Financial

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Stifel Financial are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak technical and fundamental indicators, Stifel Financial may actually be approaching a critical reversion point that can send shares even higher in July 2024.

Pair Trading with Hall Of and Stifel Financial

The main advantage of trading using opposite Hall Of and Stifel Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hall Of 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 Hall of Fame and Stifel 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..