Correlation Between Blue Dolphin and Adams Resources
Can any of the company-specific risk be diversified away by investing in both Blue Dolphin and Adams Resources 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 Blue Dolphin and Adams Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Dolphin Energy and Adams Resources Energy, you can compare the effects of market volatilities on Blue Dolphin and Adams Resources 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 Blue Dolphin with a short position of Adams Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Dolphin and Adams Resources.
Diversification Opportunities for Blue Dolphin and Adams Resources
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Blue and Adams is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Blue Dolphin Energy and Adams Resources Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adams Resources Energy and Blue Dolphin 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 Blue Dolphin Energy are associated (or correlated) with Adams Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adams Resources Energy has no effect on the direction of Blue Dolphin i.e., Blue Dolphin and Adams Resources go up and down completely randomly.
Pair Corralation between Blue Dolphin and Adams Resources
If you would invest 2,594 in Adams Resources Energy on August 24, 2024 and sell it today you would earn a total of 1,130 from holding Adams Resources Energy or generate 43.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 0.8% |
| Values | Daily Returns |
Blue Dolphin Energy vs. Adams Resources Energy
Performance |
| Timeline |
| Blue Dolphin Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Adams Resources Energy |
Blue Dolphin and Adams Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Dolphin and Adams Resources
The main advantage of trading using opposite Blue Dolphin and Adams Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Dolphin position performs unexpectedly, Adams Resources 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 Adams Resources will offset losses from the drop in Adams Resources' long position.| Blue Dolphin vs. Aemetis | Blue Dolphin vs. PBF Energy | Blue Dolphin vs. Clean Energy Fuels | Blue Dolphin vs. Par Pacific Holdings |
| Adams Resources vs. PrimeEnergy | Adams Resources vs. Barnwell Industries | Adams Resources vs. Acme United | Adams Resources vs. CKX Lands |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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