Correlation Between Stifel Financial and Sachem Capital
Can any of the company-specific risk be diversified away by investing in both Stifel Financial and Sachem Capital 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 Sachem Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stifel Financial and Sachem Capital Corp, you can compare the effects of market volatilities on Stifel Financial and Sachem Capital 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 Sachem Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stifel Financial and Sachem Capital.
Diversification Opportunities for Stifel Financial and Sachem Capital
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Stifel and Sachem is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Stifel Financial and Sachem Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sachem Capital Corp 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 Sachem Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sachem Capital Corp has no effect on the direction of Stifel Financial i.e., Stifel Financial and Sachem Capital go up and down completely randomly.
Pair Corralation between Stifel Financial and Sachem Capital
Considering the 90-day investment horizon Stifel Financial is expected to generate 1.07 times less return on investment than Sachem Capital. In addition to that, Stifel Financial is 3.45 times more volatile than Sachem Capital Corp. It trades about 0.05 of its total potential returns per unit of risk. Sachem Capital Corp is currently generating about 0.19 per unit of volatility. If you would invest 2,378 in Sachem Capital Corp on August 28, 2024 and sell it today you would earn a total of 132.00 from holding Sachem Capital Corp or generate 5.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stifel Financial vs. Sachem Capital Corp
Performance |
| Timeline |
| Stifel Financial |
| Sachem Capital Corp |
Stifel Financial and Sachem Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stifel Financial and Sachem Capital
The main advantage of trading using opposite Stifel Financial and Sachem Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stifel Financial position performs unexpectedly, Sachem Capital 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 Sachem Capital will offset losses from the drop in Sachem Capital'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 |
| Sachem Capital vs. Sachem Capital Corp | Sachem Capital vs. Eagle Point Credit | Sachem Capital vs. B Riley Financial |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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