Correlation Between CGG SA and Ranger Energy

Can any of the company-specific risk be diversified away by investing in both CGG SA and Ranger Energy 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 CGG SA and Ranger Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CGG SA ADR and Ranger Energy Services, you can compare the effects of market volatilities on CGG SA and Ranger Energy 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 CGG SA with a short position of Ranger Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of CGG SA and Ranger Energy.

Diversification Opportunities for CGG SA and Ranger Energy

0.0

Correlation Coefficient

CGG SA  Ranger Energy

Pay attention - limited upside

The 3 months correlation between CGG and Ranger is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CGG SA ADR and Ranger Energy Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ranger Energy Services and CGG SA 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 CGG SA ADR are associated (or correlated) with Ranger Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ranger Energy Services has no effect on the direction of CGG SA i.e., CGG SA and Ranger Energy go up and down completely randomly.

Pair Corralation between CGG SA and Ranger Energy

If you would invest  1,417  in Ranger Energy Services on December 19, 2024 and sell it today you would earn a total of  29.00  from holding Ranger Energy Services or generate 2.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CGG SA ADR  vs.  Ranger Energy Services

CGG SA ADR

Risk-Adjusted Performance

Very Weak

Over the last 90 days CGG SA ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, CGG SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ranger Energy Services

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ranger Energy Services are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable technical and fundamental indicators, Ranger Energy is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with CGG SA and Ranger Energy

The main advantage of trading using opposite CGG SA and Ranger Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CGG SA position performs unexpectedly, Ranger Energy 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 Ranger Energy will offset losses from the drop in Ranger Energy's long position.

The idea behind CGG SA ADR and Ranger Energy Services pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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.