Correlation Between Stifel Financial and Navient SR
Can any of the company-specific risk be diversified away by investing in both Stifel Financial and Navient SR 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 Navient SR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stifel Financial and Navient SR, you can compare the effects of market volatilities on Stifel Financial and Navient SR 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 Navient SR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stifel Financial and Navient SR.
Diversification Opportunities for Stifel Financial and Navient SR
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Stifel and Navient is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Stifel Financial and Navient SR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Navient SR 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 Navient SR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Navient SR has no effect on the direction of Stifel Financial i.e., Stifel Financial and Navient SR go up and down completely randomly.
Pair Corralation between Stifel Financial and Navient SR
Considering the 90-day investment horizon Stifel Financial is expected to generate 2.86 times less return on investment than Navient SR. In addition to that, Stifel Financial is 1.2 times more volatile than Navient SR. It trades about 0.1 of its total potential returns per unit of risk. Navient SR is currently generating about 0.33 per unit of volatility. If you would invest 1,776 in Navient SR on November 1, 2024 and sell it today you would earn a total of 137.00 from holding Navient SR or generate 7.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stifel Financial vs. Navient SR
Performance |
| Timeline |
| Stifel Financial |
| Navient SR |
Stifel Financial and Navient SR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stifel Financial and Navient SR
The main advantage of trading using opposite Stifel Financial and Navient SR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stifel Financial position performs unexpectedly, Navient SR 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 Navient SR will offset losses from the drop in Navient SR's long position.| Stifel Financial vs. Reinsurance Group of | Stifel Financial vs. Southern Co | Stifel Financial vs. DTE Energy Co | Stifel Financial vs. Georgia Power Co |
| Navient SR vs. Fifth Third Bancorp | Navient SR vs. Popular Capital Trust | Navient SR vs. SLM Corp Pb | Navient SR vs. CHS Inc CM |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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