Correlation Between Crossamerica Partners and Icahn Enterprises
Can any of the company-specific risk be diversified away by investing in both Crossamerica Partners and Icahn Enterprises 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 Crossamerica Partners and Icahn Enterprises into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crossamerica Partners LP and Icahn Enterprises LP, you can compare the effects of market volatilities on Crossamerica Partners and Icahn Enterprises 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 Crossamerica Partners with a short position of Icahn Enterprises. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crossamerica Partners and Icahn Enterprises.
Diversification Opportunities for Crossamerica Partners and Icahn Enterprises
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Crossamerica and Icahn is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Crossamerica Partners LP and Icahn Enterprises LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icahn Enterprises and Crossamerica Partners 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 Crossamerica Partners LP are associated (or correlated) with Icahn Enterprises. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icahn Enterprises has no effect on the direction of Crossamerica Partners i.e., Crossamerica Partners and Icahn Enterprises go up and down completely randomly.
Pair Corralation between Crossamerica Partners and Icahn Enterprises
Given the investment horizon of 90 days Crossamerica Partners LP is expected to generate 0.58 times more return on investment than Icahn Enterprises. However, Crossamerica Partners LP is 1.73 times less risky than Icahn Enterprises. It trades about 0.14 of its potential returns per unit of risk. Icahn Enterprises LP is currently generating about -0.13 per unit of risk. If you would invest 2,074 in Crossamerica Partners LP on November 1, 2024 and sell it today you would earn a total of 244.00 from holding Crossamerica Partners LP or generate 11.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Crossamerica Partners LP vs. Icahn Enterprises LP
Performance |
| Timeline |
| Crossamerica Partners |
| Icahn Enterprises |
Crossamerica Partners and Icahn Enterprises Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crossamerica Partners and Icahn Enterprises
The main advantage of trading using opposite Crossamerica Partners and Icahn Enterprises positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crossamerica Partners position performs unexpectedly, Icahn Enterprises 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 Icahn Enterprises will offset losses from the drop in Icahn Enterprises' long position.| Crossamerica Partners vs. Delek Energy | Crossamerica Partners vs. Sunoco LP | Crossamerica Partners vs. CVR Energy | Crossamerica Partners vs. Phillips 66 |
| Icahn Enterprises vs. Delek Energy | Icahn Enterprises vs. PBF Energy | Icahn Enterprises vs. HF Sinclair Corp | Icahn Enterprises vs. Delek Logistics Partners |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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