Correlation Between Sable Offshore and Xponential Fitness

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

Diversification Opportunities for Sable Offshore and Xponential Fitness

-0.01

Correlation Coefficient

Sable Offshore  Xponential Fitness

Good diversification

The 3 months correlation between Sable and Xponential is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Sable Offshore Corp and Xponential Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xponential Fitness 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 Xponential Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xponential Fitness has no effect on the direction of Sable Offshore i.e., Sable Offshore and Xponential Fitness go up and down completely randomly.

Pair Corralation between Sable Offshore and Xponential Fitness

Considering the 90-day investment horizon Sable Offshore Corp is expected to generate 1.57 times more return on investment than Xponential Fitness. However, Sable Offshore is 1.57 times more volatile than Xponential Fitness. It trades about 0.05 of its potential returns per unit of risk. Xponential Fitness is currently generating about -0.22 per unit of risk. If you would invest  2,348  in Sable Offshore Corp on September 29, 2024 and sell it today you would earn a total of  71.00  from holding Sable Offshore Corp or generate 3.02% return on investment over 90 days.

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

Sable Offshore Corp  vs.  Xponential Fitness

Sable Offshore Corp

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sable Offshore Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Sable Offshore may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Xponential Fitness

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Xponential Fitness are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Xponential Fitness may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Sable Offshore and Xponential Fitness

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

The idea behind Sable Offshore Corp and Xponential Fitness 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.