Correlation Between Saturn Oil and SandRidge Mississippian
Can any of the company-specific risk be diversified away by investing in both Saturn Oil and SandRidge Mississippian 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 Saturn Oil and SandRidge Mississippian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saturn Oil Gas and SandRidge Mississippian Trust, you can compare the effects of market volatilities on Saturn Oil and SandRidge Mississippian 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 Saturn Oil with a short position of SandRidge Mississippian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saturn Oil and SandRidge Mississippian.
Diversification Opportunities for Saturn Oil and SandRidge Mississippian
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Saturn and SandRidge is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Saturn Oil Gas and SandRidge Mississippian Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SandRidge Mississippian and Saturn Oil 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 Saturn Oil Gas are associated (or correlated) with SandRidge Mississippian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SandRidge Mississippian has no effect on the direction of Saturn Oil i.e., Saturn Oil and SandRidge Mississippian go up and down completely randomly.
Pair Corralation between Saturn Oil and SandRidge Mississippian
Assuming the 90 days horizon Saturn Oil is expected to generate 116.11 times less return on investment than SandRidge Mississippian. But when comparing it to its historical volatility, Saturn Oil Gas is 5.99 times less risky than SandRidge Mississippian. It trades about 0.0 of its potential returns per unit of risk. SandRidge Mississippian Trust is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 6.50 in SandRidge Mississippian Trust on August 31, 2024 and sell it today you would earn a total of 0.00 from holding SandRidge Mississippian Trust or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 8.58% |
| Values | Daily Returns |
Saturn Oil Gas vs. SandRidge Mississippian Trust
Performance |
| Timeline |
| Saturn Oil Gas |
| SandRidge Mississippian |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Saturn Oil and SandRidge Mississippian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saturn Oil and SandRidge Mississippian
The main advantage of trading using opposite Saturn Oil and SandRidge Mississippian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saturn Oil position performs unexpectedly, SandRidge Mississippian 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 SandRidge Mississippian will offset losses from the drop in SandRidge Mississippian's long position.| Saturn Oil vs. San Leon Energy | Saturn Oil vs. Enwell Energy plc | Saturn Oil vs. Dno ASA | Saturn Oil vs. Questerre Energy |
| SandRidge Mississippian vs. PetroShale | SandRidge Mississippian vs. Inpex Corp ADR | SandRidge Mississippian vs. Canacol Energy | SandRidge Mississippian vs. Battalion Oil Corp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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