Correlation Between Highway Holdings and Delek Logistics
Can any of the company-specific risk be diversified away by investing in both Highway Holdings and Delek Logistics 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 Highway Holdings and Delek Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highway Holdings Limited and Delek Logistics Partners, you can compare the effects of market volatilities on Highway Holdings and Delek Logistics 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 Highway Holdings with a short position of Delek Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highway Holdings and Delek Logistics.
Diversification Opportunities for Highway Holdings and Delek Logistics
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Highway and Delek is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Highway Holdings Limited and Delek Logistics Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delek Logistics Partners and Highway Holdings 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 Highway Holdings Limited are associated (or correlated) with Delek Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delek Logistics Partners has no effect on the direction of Highway Holdings i.e., Highway Holdings and Delek Logistics go up and down completely randomly.
Pair Corralation between Highway Holdings and Delek Logistics
Given the investment horizon of 90 days Highway Holdings Limited is expected to generate 1.69 times more return on investment than Delek Logistics. However, Highway Holdings is 1.69 times more volatile than Delek Logistics Partners. It trades about 0.01 of its potential returns per unit of risk. Delek Logistics Partners is currently generating about 0.02 per unit of risk. If you would invest 194.00 in Highway Holdings Limited on August 25, 2024 and sell it today you would lose (1.00) from holding Highway Holdings Limited or give up 0.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.13% |
| Values | Daily Returns |
Highway Holdings Limited vs. Delek Logistics Partners
Performance |
| Timeline |
| Highway Holdings |
| Delek Logistics Partners |
Highway Holdings and Delek Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highway Holdings and Delek Logistics
The main advantage of trading using opposite Highway Holdings and Delek Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highway Holdings position performs unexpectedly, Delek Logistics 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 Delek Logistics will offset losses from the drop in Delek Logistics' long position.| Highway Holdings vs. CompoSecure | Highway Holdings vs. Dave Warrants | Highway Holdings vs. Evolv Technologies Holdings | Highway Holdings vs. Aquagold International |
| Delek Logistics vs. CVR Energy | Delek Logistics vs. PBF Energy | Delek Logistics vs. HF Sinclair Corp | Delek Logistics vs. Par Pacific 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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