Correlation Between HF Sinclair and Fair Isaac

Can any of the company-specific risk be diversified away by investing in both HF Sinclair and Fair Isaac 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 Fair Isaac 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 Fair Isaac, you can compare the effects of market volatilities on HF Sinclair and Fair Isaac 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 Fair Isaac. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF Sinclair and Fair Isaac.

Diversification Opportunities for HF Sinclair and Fair Isaac

-0.02

Correlation Coefficient

HF Sinclair  Fair Isaac

Good diversification

The 3 months correlation between DINO and Fair is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding HF Sinclair Corp and Fair Isaac in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fair Isaac 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 Fair Isaac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fair Isaac has no effect on the direction of HF Sinclair i.e., HF Sinclair and Fair Isaac go up and down completely randomly.

Pair Corralation between HF Sinclair and Fair Isaac

Given the investment horizon of 90 days HF Sinclair Corp is expected to generate 1.22 times more return on investment than Fair Isaac. However, HF Sinclair is 1.22 times more volatile than Fair Isaac. It trades about -0.32 of its potential returns per unit of risk. Fair Isaac is currently generating about -0.45 per unit of risk. If you would invest  3,930  in HF Sinclair Corp on October 8, 2024 and sell it today you would lose (409.00) from holding HF Sinclair Corp or give up 10.41% of portfolio value over 90 days.

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

HF Sinclair Corp  vs.  Fair Isaac

HF Sinclair Corp

Risk-Adjusted Performance

0 of 100

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 conflicting performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Fair Isaac

Risk-Adjusted Performance

0 of 100

Weak

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

Pair Trading with HF Sinclair and Fair Isaac

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

The idea behind HF Sinclair Corp and Fair Isaac 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.