Correlation Between Jabil Circuit and Delek Logistics

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Can any of the company-specific risk be diversified away by investing in both Jabil Circuit 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 Jabil Circuit and Delek Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jabil Circuit and Delek Logistics Partners, you can compare the effects of market volatilities on Jabil Circuit 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 Jabil Circuit with a short position of Delek Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jabil Circuit and Delek Logistics.

Diversification Opportunities for Jabil Circuit and Delek Logistics

-0.53
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Jabil and Delek is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Jabil Circuit 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 Jabil Circuit 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 Jabil Circuit 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 Jabil Circuit i.e., Jabil Circuit and Delek Logistics go up and down completely randomly.

Pair Corralation between Jabil Circuit and Delek Logistics

Considering the 90-day investment horizon Jabil Circuit is expected to generate 1.11 times more return on investment than Delek Logistics. However, Jabil Circuit is 1.11 times more volatile than Delek Logistics Partners. It trades about 0.24 of its potential returns per unit of risk. Delek Logistics Partners is currently generating about 0.16 per unit of risk. If you would invest  12,896  in Jabil Circuit on September 15, 2024 and sell it today you would earn a total of  617.00  from holding Jabil Circuit or generate 4.78% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Jabil Circuit  vs.  Delek Logistics Partners

 Performance 
       Timeline  
Jabil Circuit 

Risk-Adjusted Performance

15 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Jabil Circuit are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain fundamental drivers, Jabil Circuit disclosed solid returns over the last few months and may actually be approaching a breakup point.
Delek Logistics Partners 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Delek Logistics Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Delek Logistics is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Jabil Circuit and Delek Logistics Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Jabil Circuit and Delek Logistics

The main advantage of trading using opposite Jabil Circuit and Delek Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jabil Circuit 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.
The idea behind Jabil Circuit and Delek Logistics 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.
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

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