Correlation Between Sable Offshore and Kosmos Energy
Can any of the company-specific risk be diversified away by investing in both Sable Offshore and Kosmos 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 Sable Offshore and Kosmos Energy 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 Kosmos Energy, you can compare the effects of market volatilities on Sable Offshore and Kosmos 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 Sable Offshore with a short position of Kosmos Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sable Offshore and Kosmos Energy.
Diversification Opportunities for Sable Offshore and Kosmos Energy
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sable and Kosmos is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Sable Offshore Corp and Kosmos Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kosmos Energy 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 Kosmos Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kosmos Energy has no effect on the direction of Sable Offshore i.e., Sable Offshore and Kosmos Energy go up and down completely randomly.
Pair Corralation between Sable Offshore and Kosmos Energy
Considering the 90-day investment horizon Sable Offshore Corp is expected to under-perform the Kosmos Energy. In addition to that, Sable Offshore is 2.41 times more volatile than Kosmos Energy. It trades about -0.24 of its total potential returns per unit of risk. Kosmos Energy is currently generating about -0.16 per unit of volatility. If you would invest 188.00 in Kosmos Energy on August 25, 2025 and sell it today you would lose (71.00) from holding Kosmos Energy or give up 37.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sable Offshore Corp vs. Kosmos Energy
Performance |
| Timeline |
| Sable Offshore Corp |
| Kosmos Energy |
Sable Offshore and Kosmos Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sable Offshore and Kosmos Energy
The main advantage of trading using opposite Sable Offshore and Kosmos Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sable Offshore position performs unexpectedly, Kosmos 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 Kosmos Energy will offset losses from the drop in Kosmos Energy's long position.| Sable Offshore vs. Kosmos Energy | Sable Offshore vs. Nabors Industries | Sable Offshore vs. Borr Drilling | Sable Offshore vs. Clean Energy Fuels |
| Kosmos Energy vs. MorningStar Partners, LP | Kosmos Energy vs. NGL Energy Partners | Kosmos Energy vs. Granite Ridge Resources | Kosmos Energy vs. Precision Drilling |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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