Correlation Between Sable Offshore and Rumble
Can any of the company-specific risk be diversified away by investing in both Sable Offshore and Rumble 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 Rumble 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 Rumble Inc, you can compare the effects of market volatilities on Sable Offshore and Rumble 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 Rumble. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sable Offshore and Rumble.
Diversification Opportunities for Sable Offshore and Rumble
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sable and Rumble is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Sable Offshore Corp and Rumble Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rumble Inc 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 Rumble. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rumble Inc has no effect on the direction of Sable Offshore i.e., Sable Offshore and Rumble go up and down completely randomly.
Pair Corralation between Sable Offshore and Rumble
Considering the 90-day investment horizon Sable Offshore Corp is expected to generate 1.18 times more return on investment than Rumble. However, Sable Offshore is 1.18 times more volatile than Rumble Inc. It trades about 0.08 of its potential returns per unit of risk. Rumble Inc is currently generating about 0.05 per unit of risk. If you would invest 1,469 in Sable Offshore Corp on September 3, 2024 and sell it today you would earn a total of 676.00 from holding Sable Offshore Corp or generate 46.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sable Offshore Corp vs. Rumble Inc
Performance |
| Timeline |
| Sable Offshore Corp |
| Rumble Inc |
Sable Offshore and Rumble Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sable Offshore and Rumble
The main advantage of trading using opposite Sable Offshore and Rumble positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sable Offshore position performs unexpectedly, Rumble 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 Rumble will offset losses from the drop in Rumble's long position.| Sable Offshore vs. Dine Brands Global | Sable Offshore vs. RCI Hospitality Holdings | Sable Offshore vs. Sweetgreen | Sable Offshore vs. Dennys 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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