Correlation Between Stifel Financial and Robinhood Markets
Can any of the company-specific risk be diversified away by investing in both Stifel Financial and Robinhood Markets 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 Robinhood Markets 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 Robinhood Markets, you can compare the effects of market volatilities on Stifel Financial and Robinhood Markets 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 Robinhood Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stifel Financial and Robinhood Markets.
Diversification Opportunities for Stifel Financial and Robinhood Markets
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Stifel and Robinhood is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Stifel Financial Corp and Robinhood Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robinhood Markets 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 Robinhood Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robinhood Markets has no effect on the direction of Stifel Financial i.e., Stifel Financial and Robinhood Markets go up and down completely randomly.
Pair Corralation between Stifel Financial and Robinhood Markets
Assuming the 90 days horizon Stifel Financial is expected to generate 87.51 times less return on investment than Robinhood Markets. But when comparing it to its historical volatility, Stifel Financial Corp is 13.63 times less risky than Robinhood Markets. It trades about 0.04 of its potential returns per unit of risk. Robinhood Markets is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 2,821 in Robinhood Markets on August 31, 2024 and sell it today you would earn a total of 944.00 from holding Robinhood Markets or generate 33.46% 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. Robinhood Markets
Performance |
| Timeline |
| Stifel Financial Corp |
| Robinhood Markets |
Stifel Financial and Robinhood Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stifel Financial and Robinhood Markets
The main advantage of trading using opposite Stifel Financial and Robinhood Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stifel Financial position performs unexpectedly, Robinhood Markets 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 Robinhood Markets will offset losses from the drop in Robinhood Markets' long position.| Stifel Financial vs. Perella Weinberg Partners | Stifel Financial vs. Oppenheimer Holdings | Stifel Financial vs. Stifel Financial Corp | Stifel Financial vs. Piper Sandler Companies |
| Robinhood Markets vs. Crowdstrike Holdings | Robinhood Markets vs. Palantir Technologies Class | Robinhood Markets vs. Cloudflare | Robinhood Markets vs. Adobe Systems Incorporated |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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