Correlation Between Crossamerica Partners and Par Pacific
Can any of the company-specific risk be diversified away by investing in both Crossamerica Partners and Par Pacific 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 Par Pacific 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 Par Pacific Holdings, you can compare the effects of market volatilities on Crossamerica Partners and Par Pacific 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 Par Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crossamerica Partners and Par Pacific.
Diversification Opportunities for Crossamerica Partners and Par Pacific
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Crossamerica and Par is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Crossamerica Partners LP and Par Pacific Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Par Pacific Holdings 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 Par Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Par Pacific Holdings has no effect on the direction of Crossamerica Partners i.e., Crossamerica Partners and Par Pacific go up and down completely randomly.
Pair Corralation between Crossamerica Partners and Par Pacific
Given the investment horizon of 90 days Crossamerica Partners LP is expected to generate 0.61 times more return on investment than Par Pacific. However, Crossamerica Partners LP is 1.63 times less risky than Par Pacific. It trades about 0.04 of its potential returns per unit of risk. Par Pacific Holdings is currently generating about 0.0 per unit of risk. If you would invest 1,581 in Crossamerica Partners LP on August 27, 2024 and sell it today you would earn a total of 451.00 from holding Crossamerica Partners LP or generate 28.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Crossamerica Partners LP vs. Par Pacific Holdings
Performance |
| Timeline |
| Crossamerica Partners |
| Par Pacific Holdings |
Crossamerica Partners and Par Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crossamerica Partners and Par Pacific
The main advantage of trading using opposite Crossamerica Partners and Par Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crossamerica Partners position performs unexpectedly, Par Pacific 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 Par Pacific will offset losses from the drop in Par Pacific's long position.| Crossamerica Partners vs. Delek Energy | Crossamerica Partners vs. Sunoco LP | Crossamerica Partners vs. CVR Energy | Crossamerica Partners vs. Phillips 66 |
| Par Pacific vs. Delek Logistics Partners | Par Pacific vs. CVR Energy | Par Pacific vs. PBF Energy | Par Pacific vs. HF Sinclair Corp |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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