Correlation Between Expro Group and Solaris Energy

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

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

Diversification Opportunities for Expro Group and Solaris Energy

-0.74

Correlation Coefficient

Expro Group  Solaris Energy

Pay attention - limited upside

The 3 months correlation between Expro and Solaris is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Expro Group Holdings and Solaris Energy Infrastructure, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solaris Energy Infra and Expro Group 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 Expro Group Holdings are associated (or correlated) with Solaris Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solaris Energy Infra has no effect on the direction of Expro Group i.e., Expro Group and Solaris Energy go up and down completely randomly.

Pair Corralation between Expro Group and Solaris Energy

Given the investment horizon of 90 days Expro Group Holdings is expected to under-perform the Solaris Energy. But the stock apears to be less risky and, when comparing its historical volatility, Expro Group Holdings is 1.25 times less risky than Solaris Energy. The stock trades about -0.03 of its potential returns per unit of risk. The Solaris Energy Infrastructure, is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  945.00  in Solaris Energy Infrastructure, on October 6, 2024 and sell it today you would earn a total of  2,017  from holding Solaris Energy Infrastructure, or generate 213.44% return on investment over 90 days.

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

Expro Group Holdings  vs.  Solaris Energy Infrastructure,

Expro Group Holdings

Risk-Adjusted Performance

0 of 100

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 February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Solaris Energy Infra

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Solaris Energy Infrastructure, are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain technical and fundamental indicators, Solaris Energy demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Expro Group and Solaris Energy

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

The idea behind Expro Group Holdings and Solaris Energy Infrastructure, 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.