Correlation Between Sable Offshore and Oshidori International

Can any of the company-specific risk be diversified away by investing in both Sable Offshore and Oshidori International 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 Oshidori International 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 Oshidori International Holdings, you can compare the effects of market volatilities on Sable Offshore and Oshidori International 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 Oshidori International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sable Offshore and Oshidori International.

Diversification Opportunities for Sable Offshore and Oshidori International

0.15

Correlation Coefficient

Sable Offshore  Oshidori International

Average diversification

The 3 months correlation between Sable and Oshidori is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Sable Offshore Corp and Oshidori International Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oshidori International 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 Oshidori International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oshidori International has no effect on the direction of Sable Offshore i.e., Sable Offshore and Oshidori International go up and down completely randomly.

Pair Corralation between Sable Offshore and Oshidori International

Considering the 90-day investment horizon Sable Offshore is expected to generate 11.72 times less return on investment than Oshidori International. But when comparing it to its historical volatility, Sable Offshore Corp is 14.29 times less risky than Oshidori International. It trades about 0.07 of its potential returns per unit of risk. Oshidori International Holdings is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  0.06  in Oshidori International Holdings on October 4, 2024 and sell it today you would earn a total of  3.54  from holding Oshidori International Holdings or generate 5900.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	94.75%
Values	Daily Returns

Sable Offshore Corp  vs.  Oshidori International Holding

Sable Offshore Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sable Offshore Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Sable Offshore is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Oshidori International

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Oshidori International Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly conflicting fundamental indicators, Oshidori International reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sable Offshore and Oshidori International

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

The idea behind Sable Offshore Corp and Oshidori International 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.