Correlation Between CVR Energy and Star Gas
Can any of the company-specific risk be diversified away by investing in both CVR Energy and Star Gas 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 CVR Energy and Star Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVR Energy and Star Gas Partners, you can compare the effects of market volatilities on CVR Energy and Star Gas 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 CVR Energy with a short position of Star Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Energy and Star Gas.
Diversification Opportunities for CVR Energy and Star Gas
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CVR and Star is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding CVR Energy and Star Gas Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Star Gas Partners and CVR Energy 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 CVR Energy are associated (or correlated) with Star Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Star Gas Partners has no effect on the direction of CVR Energy i.e., CVR Energy and Star Gas go up and down completely randomly.
Pair Corralation between CVR Energy and Star Gas
Considering the 90-day investment horizon CVR Energy is expected to under-perform the Star Gas. In addition to that, CVR Energy is 1.11 times more volatile than Star Gas Partners. It trades about -0.01 of its total potential returns per unit of risk. Star Gas Partners is currently generating about 0.05 per unit of volatility. If you would invest 780.00 in Star Gas Partners on August 24, 2024 and sell it today you would earn a total of 468.00 from holding Star Gas Partners or generate 60.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVR Energy vs. Star Gas Partners
Performance |
| Timeline |
| CVR Energy |
| Star Gas Partners |
CVR Energy and Star Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVR Energy and Star Gas
The main advantage of trading using opposite CVR Energy and Star Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Energy position performs unexpectedly, Star Gas 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 Star Gas will offset losses from the drop in Star Gas' long position.| CVR Energy vs. Delek Logistics Partners | CVR Energy vs. PBF Energy | CVR Energy vs. HF Sinclair Corp | CVR Energy vs. Par Pacific Holdings |
| Star Gas vs. Ultrapar Participacoes SA | Star Gas vs. Par Pacific Holdings | Star Gas vs. Delek Energy | Star Gas vs. Crossamerica Partners 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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