Correlation Between Dynagas LNG and Holly Energy
Can any of the company-specific risk be diversified away by investing in both Dynagas LNG and Holly Energy 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 Dynagas LNG and Holly Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynagas LNG Partners and Holly Energy Partners, you can compare the effects of market volatilities on Dynagas LNG and Holly Energy 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 Dynagas LNG with a short position of Holly Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynagas LNG and Holly Energy.
Diversification Opportunities for Dynagas LNG and Holly Energy
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dynagas and Holly is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Dynagas LNG Partners and Holly Energy Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holly Energy Partners and Dynagas LNG 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 Dynagas LNG Partners are associated (or correlated) with Holly Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holly Energy Partners has no effect on the direction of Dynagas LNG i.e., Dynagas LNG and Holly Energy go up and down completely randomly.
Pair Corralation between Dynagas LNG and Holly Energy
If you would invest 411.00 in Dynagas LNG Partners on September 3, 2024 and sell it today you would earn a total of 55.00 from holding Dynagas LNG Partners or generate 13.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Dynagas LNG Partners vs. Holly Energy Partners
Performance |
| Timeline |
| Dynagas LNG Partners |
| Holly Energy Partners |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Dynagas LNG and Holly Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynagas LNG and Holly Energy
The main advantage of trading using opposite Dynagas LNG and Holly Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynagas LNG position performs unexpectedly, Holly Energy 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 Holly Energy will offset losses from the drop in Holly Energy's long position.| Dynagas LNG vs. Tidewater Midstream and | Dynagas LNG vs. Martin Midstream Partners | Dynagas LNG vs. Kinetik Holdings | Dynagas LNG vs. Dynagas LNG Partners |
| Holly Energy vs. MPLX LP | Holly Energy vs. Western Midstream Partners | Holly Energy vs. Plains All American | Holly Energy vs. Genesis Energy 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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