Correlation Between 694308JT5 and Sable Offshore

Can any of the company-specific risk be diversified away by investing in both 694308JT5 and Sable Offshore 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 694308JT5 and Sable Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PCG 325 01 JUN 31 and Sable Offshore Corp, you can compare the effects of market volatilities on 694308JT5 and Sable Offshore 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 694308JT5 with a short position of Sable Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of 694308JT5 and Sable Offshore.

Diversification Opportunities for 694308JT5 and Sable Offshore

-0.08

Correlation Coefficient

694308JT5  Sable Offshore

Good diversification

The 3 months correlation between 694308JT5 and Sable is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding PCG 325 01 JUN 31 and Sable Offshore Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sable Offshore Corp and 694308JT5 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 PCG 325 01 JUN 31 are associated (or correlated) with Sable Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sable Offshore Corp has no effect on the direction of 694308JT5 i.e., 694308JT5 and Sable Offshore go up and down completely randomly.

Pair Corralation between 694308JT5 and Sable Offshore

Assuming the 90 days trading horizon PCG 325 01 JUN 31 is expected to under-perform the Sable Offshore. But the bond apears to be less risky and, when comparing its historical volatility, PCG 325 01 JUN 31 is 1.8 times less risky than Sable Offshore. The bond trades about -0.28 of its potential returns per unit of risk. The Sable Offshore Corp is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  2,048  in Sable Offshore Corp on October 5, 2024 and sell it today you would earn a total of  280.00  from holding Sable Offshore Corp or generate 13.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	80.0%
Values	Daily Returns

PCG 325 01 JUN 31  vs.  Sable Offshore Corp

PCG 325 01

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PCG 325 01 JUN 31 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for PCG 325 01 JUN 31 investors.

Sable Offshore Corp

Risk-Adjusted Performance

2 of 100

Very 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 February 2025.

Pair Trading with 694308JT5 and Sable Offshore

The main advantage of trading using opposite 694308JT5 and Sable Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 694308JT5 position performs unexpectedly, Sable Offshore 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 Sable Offshore will offset losses from the drop in Sable Offshore's long position.

The idea behind PCG 325 01 JUN 31 and Sable Offshore Corp 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.