Correlation Between Raymond James and Piper Sandler

Can any of the company-specific risk be diversified away by investing in both Raymond James and Piper Sandler 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 Raymond James and Piper Sandler into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Raymond James Financial and Piper Sandler Companies, you can compare the effects of market volatilities on Raymond James and Piper Sandler 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 Raymond James with a short position of Piper Sandler. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raymond James and Piper Sandler.

Diversification Opportunities for Raymond James and Piper Sandler

0.79

Correlation Coefficient

Raymond James  Piper Sandler

Poor diversification

The 3 months correlation between Raymond and Piper is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Raymond James Financial and Piper Sandler Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Piper Sandler Companies and Raymond James 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 Raymond James Financial are associated (or correlated) with Piper Sandler. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Piper Sandler Companies has no effect on the direction of Raymond James i.e., Raymond James and Piper Sandler go up and down completely randomly.

Pair Corralation between Raymond James and Piper Sandler

Considering the 90-day investment horizon Raymond James Financial is expected to generate about the same return on investment as Piper Sandler Companies. But, Raymond James Financial is 1.39 times less risky than Piper Sandler. It trades about 0.16 of its potential returns per unit of risk. Piper Sandler Companies is currently generating about 0.11 per unit of risk. If you would invest  25,794  in Piper Sandler Companies on July 16, 2024 and sell it today you would earn a total of  3,665  from holding Piper Sandler Companies or generate 14.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Raymond James Financial  vs.  Piper Sandler Companies

Raymond James Financial

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Raymond James Financial are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain forward-looking indicators, Raymond James reported solid returns over the last few months and may actually be approaching a breakup point.

Piper Sandler Companies

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Piper Sandler Companies are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Piper Sandler reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Raymond James and Piper Sandler

The main advantage of trading using opposite Raymond James and Piper Sandler positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raymond James position performs unexpectedly, Piper Sandler 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 Piper Sandler will offset losses from the drop in Piper Sandler's long position.

The idea behind Raymond James Financial and Piper Sandler Companies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.