Correlation Between Ranger Energy and Expro Group

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

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

Diversification Opportunities for Ranger Energy and Expro Group

0.87

Correlation Coefficient

Ranger Energy  Expro Group

Very poor diversification

The 3 months correlation between Ranger and Expro is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Ranger Energy Services and Expro Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expro Group Holdings and Ranger Energy 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 Ranger Energy Services are associated (or correlated) with Expro Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expro Group Holdings has no effect on the direction of Ranger Energy i.e., Ranger Energy and Expro Group go up and down completely randomly.

Pair Corralation between Ranger Energy and Expro Group

Given the investment horizon of 90 days Ranger Energy Services is expected to generate 0.78 times more return on investment than Expro Group. However, Ranger Energy Services is 1.28 times less risky than Expro Group. It trades about -0.03 of its potential returns per unit of risk. Expro Group Holdings is currently generating about -0.08 per unit of risk. If you would invest  1,517  in Ranger Energy Services on December 28, 2024 and sell it today you would lose (91.00) from holding Ranger Energy Services or give up 6.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Ranger Energy Services  vs.  Expro Group Holdings

Ranger Energy Services

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ranger Energy Services has generated negative risk-adjusted returns adding no value to investors with long positions. 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.

Expro Group Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Expro Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Ranger Energy and Expro Group

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

The idea behind Ranger Energy Services and Expro Group Holdings 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.

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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.