Correlation Between HF Sinclair and Alliance Resource
Can any of the company-specific risk be diversified away by investing in both HF Sinclair and Alliance Resource 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 HF Sinclair and Alliance Resource into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HF Sinclair Corp and Alliance Resource Partners, you can compare the effects of market volatilities on HF Sinclair and Alliance Resource 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 HF Sinclair with a short position of Alliance Resource. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF Sinclair and Alliance Resource.
Diversification Opportunities for HF Sinclair and Alliance Resource
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DINO and Alliance is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding HF Sinclair Corp and Alliance Resource Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alliance Resource and HF Sinclair 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 HF Sinclair Corp are associated (or correlated) with Alliance Resource. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alliance Resource has no effect on the direction of HF Sinclair i.e., HF Sinclair and Alliance Resource go up and down completely randomly.
Pair Corralation between HF Sinclair and Alliance Resource
Given the investment horizon of 90 days HF Sinclair is expected to generate 65.73 times less return on investment than Alliance Resource. In addition to that, HF Sinclair is 1.3 times more volatile than Alliance Resource Partners. It trades about 0.0 of its total potential returns per unit of risk. Alliance Resource Partners is currently generating about 0.38 per unit of volatility. If you would invest 2,485 in Alliance Resource Partners on August 27, 2024 and sell it today you would earn a total of 373.00 from holding Alliance Resource Partners or generate 15.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HF Sinclair Corp vs. Alliance Resource Partners
Performance |
| Timeline |
| HF Sinclair Corp |
| Alliance Resource |
HF Sinclair and Alliance Resource Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HF Sinclair and Alliance Resource
The main advantage of trading using opposite HF Sinclair and Alliance Resource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HF Sinclair position performs unexpectedly, Alliance Resource 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 Alliance Resource will offset losses from the drop in Alliance Resource's long position.| HF Sinclair vs. Delek Energy | HF Sinclair vs. CVR Energy | HF Sinclair vs. Valero Energy | HF Sinclair vs. Marathon Petroleum Corp |
| Alliance Resource vs. Peabody Energy Corp | Alliance Resource vs. Natural Resource Partners | Alliance Resource vs. Hallador Energy | Alliance Resource vs. NACCO Industries |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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