Correlation Between Greenhill and Stifel Financial
Can any of the company-specific risk be diversified away by investing in both Greenhill 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 Greenhill and Stifel Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greenhill Co and Stifel Financial, you can compare the effects of market volatilities on Greenhill 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 Greenhill with a short position of Stifel Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenhill and Stifel Financial.
Diversification Opportunities for Greenhill and Stifel Financial
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Greenhill and Stifel is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Greenhill Co and Stifel Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stifel Financial and Greenhill 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 Greenhill Co 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 Greenhill i.e., Greenhill and Stifel Financial go up and down completely randomly.
Pair Corralation between Greenhill and Stifel Financial
Considering the 90-day investment horizon Greenhill Co is expected to generate 5.7 times more return on investment than Stifel Financial. However, Greenhill is 5.7 times more volatile than Stifel Financial. It trades about 0.06 of its potential returns per unit of risk. Stifel Financial is currently generating about 0.09 per unit of risk. If you would invest 918.00 in Greenhill Co on August 27, 2024 and sell it today you would earn a total of 555.00 from holding Greenhill Co or generate 60.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 31.85% |
| Values | Daily Returns |
Greenhill Co vs. Stifel Financial
Performance |
| Timeline |
| Greenhill |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Stifel Financial |
Greenhill and Stifel Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greenhill and Stifel Financial
The main advantage of trading using opposite Greenhill and Stifel Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenhill 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.| Greenhill vs. Magic Empire Global | Greenhill vs. Applied Blockchain | Greenhill vs. Zhong Yang Financial | Greenhill vs. Netcapital |
| Stifel Financial vs. Raymond James Financial | Stifel Financial vs. Evercore Partners | Stifel Financial vs. Selective Insurance Group | Stifel Financial vs. Reinsurance Group of |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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