Correlation Between Lazard and Stifel Financial
Can any of the company-specific risk be diversified away by investing in both Lazard 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 Lazard and Stifel Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazard and Stifel Financial, you can compare the effects of market volatilities on Lazard 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 Lazard with a short position of Stifel Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazard and Stifel Financial.
Diversification Opportunities for Lazard and Stifel Financial
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lazard and Stifel is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Lazard and Stifel Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stifel Financial and Lazard 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 Lazard 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 Lazard i.e., Lazard and Stifel Financial go up and down completely randomly.
Pair Corralation between Lazard and Stifel Financial
Considering the 90-day investment horizon Lazard is expected to generate 1.15 times less return on investment than Stifel Financial. In addition to that, Lazard is 1.81 times more volatile than Stifel Financial. It trades about 0.16 of its total potential returns per unit of risk. Stifel Financial is currently generating about 0.34 per unit of volatility. If you would invest 10,613 in Stifel Financial on November 2, 2024 and sell it today you would earn a total of 1,147 from holding Stifel Financial or generate 10.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lazard vs. Stifel Financial
Performance |
| Timeline |
| Lazard |
| Stifel Financial |
Lazard and Stifel Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazard and Stifel Financial
The main advantage of trading using opposite Lazard and Stifel Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazard 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.| Lazard vs. PJT Partners | Lazard vs. Moelis Co | Lazard vs. Houlihan Lokey | Lazard vs. Piper Sandler Companies |
| Stifel Financial vs. PJT Partners | Stifel Financial vs. Houlihan Lokey | Stifel Financial vs. Piper Sandler Companies | Stifel Financial vs. Perella Weinberg Partners |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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