Correlation Between Delek Logistics and Roma Green
Can any of the company-specific risk be diversified away by investing in both Delek Logistics and Roma Green 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 Roma Green 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 Roma Green Finance, you can compare the effects of market volatilities on Delek Logistics and Roma Green 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 Roma Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Logistics and Roma Green.
Diversification Opportunities for Delek Logistics and Roma Green
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Delek and Roma is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Delek Logistics Partners and Roma Green Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roma Green Finance 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 Roma Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roma Green Finance has no effect on the direction of Delek Logistics i.e., Delek Logistics and Roma Green go up and down completely randomly.
Pair Corralation between Delek Logistics and Roma Green
Considering the 90-day investment horizon Delek Logistics Partners is expected to generate 0.2 times more return on investment than Roma Green. However, Delek Logistics Partners is 5.07 times less risky than Roma Green. It trades about 0.45 of its potential returns per unit of risk. Roma Green Finance is currently generating about -0.25 per unit of risk. If you would invest 3,892 in Delek Logistics Partners on October 9, 2024 and sell it today you would earn a total of 298.00 from holding Delek Logistics Partners or generate 7.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Logistics Partners vs. Roma Green Finance
Performance |
| Timeline |
| Delek Logistics Partners |
| Roma Green Finance |
Delek Logistics and Roma Green Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek Logistics and Roma Green
The main advantage of trading using opposite Delek Logistics and Roma Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek Logistics position performs unexpectedly, Roma Green 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 Roma Green will offset losses from the drop in Roma Green'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 |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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