Correlation Between GasLog Partners and Holly Energy
Can any of the company-specific risk be diversified away by investing in both GasLog Partners 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 GasLog Partners and Holly Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GasLog Partners LP and Holly Energy Partners, you can compare the effects of market volatilities on GasLog Partners 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 GasLog Partners with a short position of Holly Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of GasLog Partners and Holly Energy.
Diversification Opportunities for GasLog Partners and Holly Energy
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GasLog and Holly is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding GasLog Partners LP 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 GasLog Partners 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 GasLog Partners LP 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 GasLog Partners i.e., GasLog Partners and Holly Energy go up and down completely randomly.
Pair Corralation between GasLog Partners and Holly Energy
Assuming the 90 days trading horizon GasLog Partners is expected to generate 1.54 times less return on investment than Holly Energy. But when comparing it to its historical volatility, GasLog Partners LP is 1.52 times less risky than Holly Energy. It trades about 0.07 of its potential returns per unit of risk. Holly Energy Partners is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,729 in Holly Energy Partners on September 3, 2024 and sell it today you would earn a total of 215.00 from holding Holly Energy Partners or generate 12.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 30.91% |
| Values | Daily Returns |
GasLog Partners LP vs. Holly Energy Partners
Performance |
| Timeline |
| GasLog Partners LP |
| Holly Energy Partners |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GasLog Partners and Holly Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GasLog Partners and Holly Energy
The main advantage of trading using opposite GasLog Partners and Holly Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GasLog Partners 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.The idea behind GasLog Partners LP and Holly Energy Partners pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |