Correlation Between Sable Offshore and Gannett
Can any of the company-specific risk be diversified away by investing in both Sable Offshore and Gannett 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 Sable Offshore and Gannett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sable Offshore Corp and Gannett Co, you can compare the effects of market volatilities on Sable Offshore and Gannett 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 Sable Offshore with a short position of Gannett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sable Offshore and Gannett.
Diversification Opportunities for Sable Offshore and Gannett
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sable and Gannett is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Sable Offshore Corp and Gannett Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gannett and Sable Offshore 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 Sable Offshore Corp are associated (or correlated) with Gannett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gannett has no effect on the direction of Sable Offshore i.e., Sable Offshore and Gannett go up and down completely randomly.
Pair Corralation between Sable Offshore and Gannett
Considering the 90-day investment horizon Sable Offshore Corp is expected to generate 2.01 times more return on investment than Gannett. However, Sable Offshore is 2.01 times more volatile than Gannett Co. It trades about 0.01 of its potential returns per unit of risk. Gannett Co is currently generating about -0.2 per unit of risk. If you would invest 2,276 in Sable Offshore Corp on November 9, 2024 and sell it today you would lose (17.00) from holding Sable Offshore Corp or give up 0.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sable Offshore Corp vs. Gannett Co
Performance |
| Timeline |
| Sable Offshore Corp |
| Gannett |
Sable Offshore and Gannett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sable Offshore and Gannett
The main advantage of trading using opposite Sable Offshore and Gannett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sable Offshore position performs unexpectedly, Gannett 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 Gannett will offset losses from the drop in Gannett's long position.| Sable Offshore vs. LAir Liquide SA | Sable Offshore vs. Cirrus Logic | Sable Offshore vs. ASML Holding NV | Sable Offshore vs. MagnaChip Semiconductor |
| Gannett vs. Dallasnews Corp | Gannett vs. Scholastic | Gannett vs. Pearson PLC ADR | Gannett vs. New York Times |
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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