Correlation Between Stifel Financial and OneMain Holdings
Can any of the company-specific risk be diversified away by investing in both Stifel Financial and OneMain Holdings 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 OneMain Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stifel Financial and OneMain Holdings, you can compare the effects of market volatilities on Stifel Financial and OneMain Holdings 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 OneMain Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stifel Financial and OneMain Holdings.
Diversification Opportunities for Stifel Financial and OneMain Holdings
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Stifel and OneMain is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Stifel Financial and OneMain Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OneMain Holdings 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 OneMain Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OneMain Holdings has no effect on the direction of Stifel Financial i.e., Stifel Financial and OneMain Holdings go up and down completely randomly.
Pair Corralation between Stifel Financial and OneMain Holdings
Allowing for the 90-day total investment horizon Stifel Financial is expected to generate 0.79 times more return on investment than OneMain Holdings. However, Stifel Financial is 1.26 times less risky than OneMain Holdings. It trades about 0.17 of its potential returns per unit of risk. OneMain Holdings is currently generating about 0.1 per unit of risk. If you would invest 5,904 in Stifel Financial on September 1, 2024 and sell it today you would earn a total of 5,676 from holding Stifel Financial or generate 96.14% 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. OneMain Holdings
Performance |
| Timeline |
| Stifel Financial |
| OneMain Holdings |
Stifel Financial and OneMain Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stifel Financial and OneMain Holdings
The main advantage of trading using opposite Stifel Financial and OneMain Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stifel Financial position performs unexpectedly, OneMain Holdings 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 OneMain Holdings will offset losses from the drop in OneMain Holdings' long position.| Stifel Financial vs. Lazard | Stifel Financial vs. PJT Partners | Stifel Financial vs. Houlihan Lokey | Stifel Financial vs. Piper Sandler Companies |
| OneMain Holdings vs. 360 Finance | OneMain Holdings vs. Atlanticus Holdings | OneMain Holdings vs. Qudian Inc | OneMain Holdings vs. Enova International |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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