Correlation Between HF Sinclair and Crossamerica Partners

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

By analyzing existing cross correlation between HF Sinclair Corp and Crossamerica Partners LP, you can compare the effects of market volatilities on HF Sinclair and Crossamerica Partners 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 HF Sinclair with a short position of Crossamerica Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF Sinclair and Crossamerica Partners.

Diversification Opportunities for HF Sinclair and Crossamerica Partners

-0.36

Correlation Coefficient

HF Sinclair  Crossamerica Partners

Very good diversification

The 3 months correlation between DINO and Crossamerica is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding HF Sinclair Corp and Crossamerica Partners LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crossamerica Partners and HF Sinclair 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 HF Sinclair Corp are associated (or correlated) with Crossamerica Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crossamerica Partners has no effect on the direction of HF Sinclair i.e., HF Sinclair and Crossamerica Partners go up and down completely randomly.

Pair Corralation between HF Sinclair and Crossamerica Partners

Given the investment horizon of 90 days HF Sinclair Corp is expected to under-perform the Crossamerica Partners. In addition to that, HF Sinclair is 2.46 times more volatile than Crossamerica Partners LP. It trades about 0.0 of its total potential returns per unit of risk. Crossamerica Partners LP is currently generating about 0.23 per unit of volatility. If you would invest  2,116  in Crossamerica Partners LP on December 30, 2024 and sell it today you would earn a total of  317.00  from holding Crossamerica Partners LP or generate 14.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

HF Sinclair Corp  vs.  Crossamerica Partners LP

HF Sinclair Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days HF Sinclair Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, HF Sinclair is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Crossamerica Partners

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Crossamerica Partners LP are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Crossamerica Partners disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HF Sinclair and Crossamerica Partners

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

The idea behind HF Sinclair Corp and Crossamerica Partners LP 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 Stocks Directory module to find actively traded stocks across global markets.