Correlation Between Ampol and Phillips
Can any of the company-specific risk be diversified away by investing in both Ampol and Phillips 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 Ampol and Phillips into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ampol Ltd ADR and Phillips 66, you can compare the effects of market volatilities on Ampol and Phillips 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 Ampol with a short position of Phillips. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ampol and Phillips.
Diversification Opportunities for Ampol and Phillips
Very weak diversification
The 3 months correlation between Ampol and Phillips is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Ampol Ltd ADR and Phillips 66 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phillips 66 and Ampol 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 Ampol Ltd ADR are associated (or correlated) with Phillips. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phillips 66 has no effect on the direction of Ampol i.e., Ampol and Phillips go up and down completely randomly.
Pair Corralation between Ampol and Phillips
Assuming the 90 days horizon Ampol Ltd ADR is expected to under-perform the Phillips. In addition to that, Ampol is 1.06 times more volatile than Phillips 66. It trades about -0.07 of its total potential returns per unit of risk. Phillips 66 is currently generating about 0.0 per unit of volatility. If you would invest 13,506 in Phillips 66 on September 3, 2024 and sell it today you would lose (108.00) from holding Phillips 66 or give up 0.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ampol Ltd ADR vs. Phillips 66
Performance |
| Timeline |
| Ampol Ltd ADR |
| Phillips 66 |
Ampol and Phillips Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ampol and Phillips
The main advantage of trading using opposite Ampol and Phillips positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ampol position performs unexpectedly, Phillips 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 Phillips will offset losses from the drop in Phillips' long position.| Ampol vs. Ultrapar Participacoes SA | Ampol vs. Sunoco LP | Ampol vs. HF Sinclair Corp | Ampol vs. Delek Energy |
| Phillips vs. Marathon Petroleum Corp | Phillips vs. HF Sinclair Corp | Phillips vs. PBF Energy | Phillips vs. Sunoco LP |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |