Correlation Between Delek Energy and Star Gas
Can any of the company-specific risk be diversified away by investing in both Delek 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 Delek 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 Delek Energy and Star Gas Partners, you can compare the effects of market volatilities on Delek 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 Delek Energy with a short position of Star Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Energy and Star Gas.
Diversification Opportunities for Delek Energy and Star Gas
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Delek and Star is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Delek 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 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 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 Delek Energy i.e., Delek Energy and Star Gas go up and down completely randomly.
Pair Corralation between Delek Energy and Star Gas
Allowing for the 90-day total investment horizon Delek Energy is expected to generate 1.02 times less return on investment than Star Gas. In addition to that, Delek Energy is 1.4 times more volatile than Star Gas Partners. It trades about 0.17 of its total potential returns per unit of risk. Star Gas Partners is currently generating about 0.24 per unit of volatility. If you would invest 1,138 in Star Gas Partners on August 27, 2024 and sell it today you would earn a total of 123.00 from holding Star Gas Partners or generate 10.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Energy vs. Star Gas Partners
Performance |
| Timeline |
| Delek Energy |
| Star Gas Partners |
Delek Energy and Star Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek Energy and Star Gas
The main advantage of trading using opposite Delek Energy and Star Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek 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.| Delek Energy vs. Crossamerica Partners LP | Delek Energy vs. Sunoco LP | Delek Energy vs. CVR Energy | Delek Energy vs. Phillips 66 |
| 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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