Correlation Between Delek Logistics and Ardmore Shpng
Can any of the company-specific risk be diversified away by investing in both Delek Logistics and Ardmore Shpng 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 Logistics and Ardmore Shpng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delek Logistics Partners and Ardmore Shpng, you can compare the effects of market volatilities on Delek Logistics and Ardmore Shpng 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 Logistics with a short position of Ardmore Shpng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Logistics and Ardmore Shpng.
Diversification Opportunities for Delek Logistics and Ardmore Shpng
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Delek and Ardmore is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Delek Logistics Partners and Ardmore Shpng in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ardmore Shpng and Delek Logistics 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 Logistics Partners are associated (or correlated) with Ardmore Shpng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ardmore Shpng has no effect on the direction of Delek Logistics i.e., Delek Logistics and Ardmore Shpng go up and down completely randomly.
Pair Corralation between Delek Logistics and Ardmore Shpng
Considering the 90-day investment horizon Delek Logistics Partners is expected to generate 0.89 times more return on investment than Ardmore Shpng. However, Delek Logistics Partners is 1.12 times less risky than Ardmore Shpng. It trades about -0.04 of its potential returns per unit of risk. Ardmore Shpng is currently generating about -0.3 per unit of risk. If you would invest 4,108 in Delek Logistics Partners on September 12, 2024 and sell it today you would lose (227.50) from holding Delek Logistics Partners or give up 5.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Logistics Partners vs. Ardmore Shpng
Performance |
| Timeline |
| Delek Logistics Partners |
| Ardmore Shpng |
Delek Logistics and Ardmore Shpng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek Logistics and Ardmore Shpng
The main advantage of trading using opposite Delek Logistics and Ardmore Shpng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek Logistics position performs unexpectedly, Ardmore Shpng 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 Ardmore Shpng will offset losses from the drop in Ardmore Shpng's long position.| Delek Logistics vs. CVR Energy | Delek Logistics vs. PBF Energy | Delek Logistics vs. HF Sinclair Corp | Delek Logistics vs. Par Pacific Holdings |
| Ardmore Shpng vs. International Seaways | Ardmore Shpng vs. Scorpio Tankers | Ardmore Shpng vs. Dorian LPG | Ardmore Shpng vs. Teekay Tankers |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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