Correlation Between SandRidge Energy and Riley Exploration
Can any of the company-specific risk be diversified away by investing in both SandRidge Energy and Riley Exploration 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 SandRidge Energy and Riley Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SandRidge Energy and Riley Exploration Permian, you can compare the effects of market volatilities on SandRidge Energy and Riley Exploration 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 SandRidge Energy with a short position of Riley Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of SandRidge Energy and Riley Exploration.
Diversification Opportunities for SandRidge Energy and Riley Exploration
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SandRidge and Riley is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding SandRidge Energy and Riley Exploration Permian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Riley Exploration Permian and SandRidge Energy 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 SandRidge Energy are associated (or correlated) with Riley Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Riley Exploration Permian has no effect on the direction of SandRidge Energy i.e., SandRidge Energy and Riley Exploration go up and down completely randomly.
Pair Corralation between SandRidge Energy and Riley Exploration
Allowing for the 90-day total investment horizon SandRidge Energy is expected to generate 0.86 times more return on investment than Riley Exploration. However, SandRidge Energy is 1.17 times less risky than Riley Exploration. It trades about 0.42 of its potential returns per unit of risk. Riley Exploration Permian is currently generating about 0.07 per unit of risk. If you would invest 1,157 in SandRidge Energy on August 28, 2025 and sell it today you would earn a total of 230.00 from holding SandRidge Energy or generate 19.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SandRidge Energy vs. Riley Exploration Permian
Performance |
| Timeline |
| SandRidge Energy |
| Riley Exploration Permian |
SandRidge Energy and Riley Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SandRidge Energy and Riley Exploration
The main advantage of trading using opposite SandRidge Energy and Riley Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SandRidge Energy position performs unexpectedly, Riley Exploration 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 Riley Exploration will offset losses from the drop in Riley Exploration's long position.| SandRidge Energy vs. Zijin Mining Group | SandRidge Energy vs. Glorywin Entertainment Group | SandRidge Energy vs. Perseus Mining Limited | SandRidge Energy vs. Dolphin Entertainment |
| Riley Exploration vs. CarsalesCom Ltd ADR | Riley Exploration vs. Porsche Automobile Holding | Riley Exploration vs. Guangdong Investment Limited | Riley Exploration vs. Prosperity Real Estate |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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