Correlation Between Sable Offshore and Microbot Medical

Can any of the company-specific risk be diversified away by investing in both Sable Offshore and Microbot Medical 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 Microbot Medical 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 Microbot Medical, you can compare the effects of market volatilities on Sable Offshore and Microbot Medical 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 Microbot Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sable Offshore and Microbot Medical.

Diversification Opportunities for Sable Offshore and Microbot Medical

-0.51

Correlation Coefficient

Sable Offshore  Microbot Medical

Excellent diversification

The 3 months correlation between Sable and Microbot is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Sable Offshore Corp and Microbot Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbot Medical 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 Microbot Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microbot Medical has no effect on the direction of Sable Offshore i.e., Sable Offshore and Microbot Medical go up and down completely randomly.

Pair Corralation between Sable Offshore and Microbot Medical

Considering the 90-day investment horizon Sable Offshore is expected to generate 21.57 times less return on investment than Microbot Medical. In addition to that, Sable Offshore is 1.85 times more volatile than Microbot Medical. It trades about 0.0 of its total potential returns per unit of risk. Microbot Medical is currently generating about 0.12 per unit of volatility. If you would invest  92.00  in Microbot Medical on September 20, 2024 and sell it today you would earn a total of  5.00  from holding Microbot Medical or generate 5.43% return on investment over 90 days.

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

Sable Offshore Corp  vs.  Microbot Medical

Sable Offshore Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sable Offshore Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Sable Offshore is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Microbot Medical

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Microbot Medical are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Microbot Medical may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Sable Offshore and Microbot Medical

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

The idea behind Sable Offshore Corp and Microbot Medical 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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .