Correlation Between Stifel Financial and Entergy New
Can any of the company-specific risk be diversified away by investing in both Stifel Financial and Entergy New 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 Entergy New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stifel Financial and Entergy New Orleans, you can compare the effects of market volatilities on Stifel Financial and Entergy New 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 Entergy New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stifel Financial and Entergy New.
Diversification Opportunities for Stifel Financial and Entergy New
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Stifel and Entergy is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Stifel Financial and Entergy New Orleans in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entergy New Orleans 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 Entergy New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entergy New Orleans has no effect on the direction of Stifel Financial i.e., Stifel Financial and Entergy New go up and down completely randomly.
Pair Corralation between Stifel Financial and Entergy New
Considering the 90-day investment horizon Stifel Financial is expected to generate 0.83 times more return on investment than Entergy New. However, Stifel Financial is 1.21 times less risky than Entergy New. It trades about -0.09 of its potential returns per unit of risk. Entergy New Orleans is currently generating about -0.26 per unit of risk. If you would invest 2,248 in Stifel Financial on August 28, 2024 and sell it today you would lose (36.00) from holding Stifel Financial or give up 1.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stifel Financial vs. Entergy New Orleans
Performance |
| Timeline |
| Stifel Financial |
| Entergy New Orleans |
Stifel Financial and Entergy New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stifel Financial and Entergy New
The main advantage of trading using opposite Stifel Financial and Entergy New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stifel Financial position performs unexpectedly, Entergy New 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 Entergy New will offset losses from the drop in Entergy New's long position.| Stifel Financial vs. American Financial Group | Stifel Financial vs. CMS Energy Corp | Stifel Financial vs. Reinsurance Group of |
| Entergy New vs. Genpact Limited | Entergy New vs. Broadridge Financial Solutions | Entergy New vs. First Advantage Corp | Entergy New vs. Franklin Covey |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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