Correlation Between Delek Energy and CVR Energy
Can any of the company-specific risk be diversified away by investing in both Delek Energy and CVR Energy 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 Delek Energy and CVR Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delek Energy and CVR Energy, you can compare the effects of market volatilities on Delek Energy and CVR Energy 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 Delek Energy with a short position of CVR Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Energy and CVR Energy.
Diversification Opportunities for Delek Energy and CVR Energy
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Delek and CVR is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Delek Energy and CVR Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVR Energy and Delek 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 Delek Energy are associated (or correlated) with CVR Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVR Energy has no effect on the direction of Delek Energy i.e., Delek Energy and CVR Energy go up and down completely randomly.
Pair Corralation between Delek Energy and CVR Energy
Allowing for the 90-day total investment horizon Delek Energy is expected to generate 0.78 times more return on investment than CVR Energy. However, Delek Energy is 1.28 times less risky than CVR Energy. It trades about 0.61 of its potential returns per unit of risk. CVR Energy is currently generating about 0.38 per unit of risk. If you would invest 1,613 in Delek Energy on October 20, 2024 and sell it today you would earn a total of 368.00 from holding Delek Energy or generate 22.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Energy vs. CVR Energy
Performance |
| Timeline |
| Delek Energy |
| CVR Energy |
Delek Energy and CVR Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek Energy and CVR Energy
The main advantage of trading using opposite Delek Energy and CVR Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek Energy position performs unexpectedly, CVR Energy 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 CVR Energy will offset losses from the drop in CVR Energy's long position.| Delek Energy vs. Crossamerica Partners LP | Delek Energy vs. Sunoco LP | Delek Energy vs. CVR Energy | Delek Energy vs. Phillips 66 |
| CVR Energy vs. Delek Logistics Partners | CVR Energy vs. PBF Energy | CVR Energy vs. HF Sinclair Corp | CVR Energy vs. Par Pacific Holdings |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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