Correlation Between Delek Logistics and Boston Beer
Can any of the company-specific risk be diversified away by investing in both Delek Logistics and Boston Beer 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 Boston Beer 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 Boston Beer, you can compare the effects of market volatilities on Delek Logistics and Boston Beer 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 Boston Beer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Logistics and Boston Beer.
Diversification Opportunities for Delek Logistics and Boston Beer
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Delek and Boston is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Delek Logistics Partners and Boston Beer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Beer 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 Boston Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Beer has no effect on the direction of Delek Logistics i.e., Delek Logistics and Boston Beer go up and down completely randomly.
Pair Corralation between Delek Logistics and Boston Beer
Considering the 90-day investment horizon Delek Logistics is expected to generate 1.12 times less return on investment than Boston Beer. But when comparing it to its historical volatility, Delek Logistics Partners is 1.53 times less risky than Boston Beer. It trades about 0.4 of its potential returns per unit of risk. Boston Beer is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 29,494 in Boston Beer on September 2, 2024 and sell it today you would earn a total of 2,130 from holding Boston Beer or generate 7.22% 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. Boston Beer
Performance |
| Timeline |
| Delek Logistics Partners |
| Boston Beer |
Delek Logistics and Boston Beer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek Logistics and Boston Beer
The main advantage of trading using opposite Delek Logistics and Boston Beer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek Logistics position performs unexpectedly, Boston Beer 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 Boston Beer will offset losses from the drop in Boston Beer'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 |
| Boston Beer vs. Compania Cervecerias Unidas | Boston Beer vs. Molson Coors Brewing | Boston Beer vs. Suntory Beverage Food | Boston Beer vs. Carlsberg AS |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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