Correlation Between Delek Logistics and NYSE Composite
Can any of the company-specific risk be diversified away by investing in both Delek Logistics and NYSE Composite 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 NYSE Composite 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 NYSE Composite, you can compare the effects of market volatilities on Delek Logistics and NYSE Composite 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 NYSE Composite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Logistics and NYSE Composite.
Diversification Opportunities for Delek Logistics and NYSE Composite
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Delek and NYSE is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Delek Logistics Partners and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite 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 NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Delek Logistics i.e., Delek Logistics and NYSE Composite go up and down completely randomly.
Pair Corralation between Delek Logistics and NYSE Composite
Considering the 90-day investment horizon Delek Logistics is expected to generate 1.37 times less return on investment than NYSE Composite. In addition to that, Delek Logistics is 2.75 times more volatile than NYSE Composite. It trades about 0.01 of its total potential returns per unit of risk. NYSE Composite is currently generating about 0.05 per unit of volatility. If you would invest 1,586,822 in NYSE Composite on October 15, 2024 and sell it today you would earn a total of 309,479 from holding NYSE Composite or generate 19.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Logistics Partners vs. NYSE Composite
Performance |
| Timeline |
Delek Logistics and NYSE Composite Volatility Contrast
Predicted Return Density |
| Returns |
Delek Logistics Partners
Pair trading matchups for Delek Logistics
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Delek Logistics and NYSE Composite
The main advantage of trading using opposite Delek Logistics and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek Logistics position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite'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 |
| NYSE Composite vs. Biglari Holdings | NYSE Composite vs. Cheche Group Class | NYSE Composite vs. Cannae Holdings | NYSE Composite vs. Bowhead Specialty 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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