Correlation Between CVR Energy and Aemetis
Can any of the company-specific risk be diversified away by investing in both CVR Energy and Aemetis 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 CVR Energy and Aemetis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVR Energy and Aemetis, you can compare the effects of market volatilities on CVR Energy and Aemetis 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 CVR Energy with a short position of Aemetis. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Energy and Aemetis.
Diversification Opportunities for CVR Energy and Aemetis
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between CVR and Aemetis is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding CVR Energy and Aemetis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aemetis and CVR Energy 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 CVR Energy are associated (or correlated) with Aemetis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aemetis has no effect on the direction of CVR Energy i.e., CVR Energy and Aemetis go up and down completely randomly.
Pair Corralation between CVR Energy and Aemetis
Considering the 90-day investment horizon CVR Energy is expected to generate 0.57 times more return on investment than Aemetis. However, CVR Energy is 1.77 times less risky than Aemetis. It trades about 0.06 of its potential returns per unit of risk. Aemetis is currently generating about -0.1 per unit of risk. If you would invest 1,847 in CVR Energy on December 27, 2024 and sell it today you would earn a total of 156.00 from holding CVR Energy or generate 8.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
CVR Energy vs. Aemetis
Performance |
Timeline |
CVR Energy |
Aemetis |
CVR Energy and Aemetis Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CVR Energy and Aemetis
The main advantage of trading using opposite CVR Energy and Aemetis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Energy position performs unexpectedly, Aemetis 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 Aemetis will offset losses from the drop in Aemetis' long position.CVR Energy vs. Marathon Petroleum Corp | CVR Energy vs. Sunoco LP | CVR Energy vs. Valero Energy | CVR Energy vs. Delek Energy |
Aemetis vs. PBF Energy | Aemetis vs. Clean Energy Fuels | Aemetis vs. Par Pacific Holdings | Aemetis vs. CVR Energy |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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