Correlation Between Stifel Financial and Iris Energy
Can any of the company-specific risk be diversified away by investing in both Stifel Financial and Iris Energy 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 Iris Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stifel Financial and Iris Energy, you can compare the effects of market volatilities on Stifel Financial and Iris Energy 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 Iris Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stifel Financial and Iris Energy.
Diversification Opportunities for Stifel Financial and Iris Energy
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Stifel and Iris is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Stifel Financial and Iris Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iris Energy 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 are associated (or correlated) with Iris Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iris Energy has no effect on the direction of Stifel Financial i.e., Stifel Financial and Iris Energy go up and down completely randomly.
Pair Corralation between Stifel Financial and Iris Energy
Allowing for the 90-day total investment horizon Stifel Financial is expected to generate 4.42 times less return on investment than Iris Energy. But when comparing it to its historical volatility, Stifel Financial is 4.68 times less risky than Iris Energy. It trades about 0.1 of its potential returns per unit of risk. Iris Energy is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 128.00 in Iris Energy on August 26, 2024 and sell it today you would earn a total of 950.00 from holding Iris Energy or generate 742.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stifel Financial vs. Iris Energy
Performance |
| Timeline |
| Stifel Financial |
| Iris Energy |
Stifel Financial and Iris Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stifel Financial and Iris Energy
The main advantage of trading using opposite Stifel Financial and Iris Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stifel Financial position performs unexpectedly, Iris Energy 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 Iris Energy will offset losses from the drop in Iris Energy's long position.| Stifel Financial vs. Raymond James Financial | Stifel Financial vs. Evercore Partners | Stifel Financial vs. Selective Insurance Group | Stifel Financial vs. Reinsurance Group of |
| Iris Energy vs. Corporacion America Airports | Iris Energy vs. Mayfair Gold Corp | Iris Energy vs. AerCap Holdings NV | Iris Energy vs. United Rentals |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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