Correlation Between Rocket Companies and Riley Exploration
Can any of the company-specific risk be diversified away by investing in both Rocket Companies and Riley Exploration 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 Rocket Companies and Riley Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rocket Companies and Riley Exploration Permian, you can compare the effects of market volatilities on Rocket Companies and Riley Exploration 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 Rocket Companies with a short position of Riley Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rocket Companies and Riley Exploration.
Diversification Opportunities for Rocket Companies and Riley Exploration
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Rocket and Riley is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Rocket Companies and Riley Exploration Permian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Riley Exploration Permian and Rocket Companies 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 Rocket Companies are associated (or correlated) with Riley Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Riley Exploration Permian has no effect on the direction of Rocket Companies i.e., Rocket Companies and Riley Exploration go up and down completely randomly.
Pair Corralation between Rocket Companies and Riley Exploration
Considering the 90-day investment horizon Rocket Companies is expected to generate 1.62 times more return on investment than Riley Exploration. However, Rocket Companies is 1.62 times more volatile than Riley Exploration Permian. It trades about 0.07 of its potential returns per unit of risk. Riley Exploration Permian is currently generating about 0.08 per unit of risk. If you would invest 1,678 in Rocket Companies on November 19, 2025 and sell it today you would earn a total of 190.00 from holding Rocket Companies or generate 11.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rocket Companies vs. Riley Exploration Permian
Performance |
| Timeline |
| Rocket Companies |
| Riley Exploration Permian |
Rocket Companies and Riley Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rocket Companies and Riley Exploration
The main advantage of trading using opposite Rocket Companies and Riley Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rocket Companies position performs unexpectedly, Riley Exploration 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 Riley Exploration will offset losses from the drop in Riley Exploration's long position.| Rocket Companies vs. Nasdaq Inc | Rocket Companies vs. MSCI Inc | Rocket Companies vs. MetLife | Rocket Companies vs. The Allstate |
| Riley Exploration vs. SandRidge Energy | Riley Exploration vs. GeoPark | Riley Exploration vs. NGL Energy Partners | Riley Exploration vs. Kosmos Energy |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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