Correlation Between CVR Energy and Ampol

Can any of the company-specific risk be diversified away by investing in both CVR Energy and Ampol 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 Ampol into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CVR Energy and Ampol Limited, you can compare the effects of market volatilities on CVR Energy and Ampol 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 Ampol. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Energy and Ampol.

Diversification Opportunities for CVR Energy and Ampol

0.0

Correlation Coefficient

CVR Energy  Ampol

Pay attention - limited upside

The 3 months correlation between CVR and Ampol is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CVR Energy and Ampol Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ampol Limited 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 Ampol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ampol Limited has no effect on the direction of CVR Energy i.e., CVR Energy and Ampol go up and down completely randomly.

Pair Corralation between CVR Energy and Ampol

If you would invest  1,829  in CVR Energy on December 26, 2024 and sell it today you would earn a total of  195.00  from holding CVR Energy or generate 10.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CVR Energy  vs.  Ampol Limited

CVR Energy

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CVR Energy are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly conflicting basic indicators, CVR Energy demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Ampol Limited

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ampol Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ampol is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with CVR Energy and Ampol

The main advantage of trading using opposite CVR Energy and Ampol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Energy position performs unexpectedly, Ampol 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 Ampol will offset losses from the drop in Ampol's long position.

The idea behind CVR Energy and Ampol Limited 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .