Correlation Between Infinity Natural and SandRidge Energy
Can any of the company-specific risk be diversified away by investing in both Infinity Natural and SandRidge 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 Infinity Natural and SandRidge Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Infinity Natural Resources, and SandRidge Energy, you can compare the effects of market volatilities on Infinity Natural and SandRidge 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 Infinity Natural with a short position of SandRidge Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinity Natural and SandRidge Energy.
Diversification Opportunities for Infinity Natural and SandRidge Energy
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Infinity and SandRidge is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Infinity Natural Resources, and SandRidge Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SandRidge Energy and Infinity Natural 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 Infinity Natural Resources, are associated (or correlated) with SandRidge Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SandRidge Energy has no effect on the direction of Infinity Natural i.e., Infinity Natural and SandRidge Energy go up and down completely randomly.
Pair Corralation between Infinity Natural and SandRidge Energy
Considering the 90-day investment horizon Infinity Natural Resources, is expected to under-perform the SandRidge Energy. In addition to that, Infinity Natural is 1.63 times more volatile than SandRidge Energy. It trades about -0.01 of its total potential returns per unit of risk. SandRidge Energy is currently generating about 0.0 per unit of volatility. If you would invest 1,277 in SandRidge Energy on March 24, 2025 and sell it today you would lose (86.00) from holding SandRidge Energy or give up 6.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 19.8% |
| Values | Daily Returns |
Infinity Natural Resources, vs. SandRidge Energy
Performance |
| Timeline |
| Infinity Natural Res |
| SandRidge Energy |
Infinity Natural and SandRidge Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Infinity Natural and SandRidge Energy
The main advantage of trading using opposite Infinity Natural and SandRidge Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infinity Natural position performs unexpectedly, SandRidge 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 SandRidge Energy will offset losses from the drop in SandRidge Energy's long position.| Infinity Natural vs. FT Vest Equity | Infinity Natural vs. Zillow Group Class | Infinity Natural vs. Northern Lights | Infinity Natural vs. VanEck Vectors Moodys |
| SandRidge Energy vs. Range Resources Corp | SandRidge Energy vs. SM Energy Co | SandRidge Energy vs. Northern Oil Gas |
Check out your portfolio center.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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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