HOOD - Risk

Elevated Business & Solvency Risk

Caution: In addition to price volatility, there are balance sheet risks due to higher debt or weaker liquidity (Health Score: 65/100).

Volatility Risk

Transparent evaluation of price volatility (SRI), Beta, and historical drawdowns.

Volatility Risk Score

7/7 Very High

7 / 7 SRI Price Fluctuation & Beta

Very high volatility or fundamental risks. Significant loss potential; strictly for aggressive investors. Moves approx. 2.4x as much as the broader market.

Beta (Market Relation)

2.35x

Above average

Volatility (5Y p.a.)

68.5% p.a.

5-Year Horizon

Max Drawdown (5Y)

-83.6%

5-Year Horizon

Sharpe Ratio

0.27

Return / Risk

Speculative / High Risk: Score Basis:

Multi-Horizon Risk & Performance Matrix

Historical volatility, drawdowns, and risk-adjusted return across 1, 3, 5, and 10 years.

Stable Long-Term Volatility High Volatility

Timeframe	Volatility (p.a.)	Max Drawdown	Sharpe Ratio	Return (p.a.)
1 Year	—	—	—	-29.1%
3 Years	68.8%	-57.3%	1.73	+121.3%
5 Years	68.5%	-83.6%	0.27	+20.7%
10 Years	—	—	—	—

Automated Risk & Health Notes (Red Flags)

Single Stock Risk: Investing in an individual stock carries full company and insolvency risk (no fund diversification).

Critical leverage: Debt-to-Equity is at 240%.

High market risk: Beta of 2.35 indicates above-average volatility compared to the broader market.

🔴 High valuation risk: Avg P/E of 47.2 (Elevated multiple compression risk)

Structurally High Volatility: Above-average fluctuations persist across 5 to 10 years (68.5% p.a.).

Historical Stress Test: Maximum peak-to-trough drawdown of -83.6% in the extended horizon.

Corporate Governance & ISS Scores

Shareholder rights, board structure and audit safety (Scale 1 = Low Risk, 10 = High Risk)

Overall Governance Risk

10 ISS Score: 10 / 10

Audit Risk

3 ISS Score: 3 / 10

Board Risk

10 ISS Score: 10 / 10

Short Ratio

1.60