Correlation Between HF Sinclair and NCR Voyix

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

Diversification Opportunities for HF Sinclair and NCR Voyix

-0.32

Correlation Coefficient

HF Sinclair  NCR Voyix

Very good diversification

The 3 months correlation between DINO and NCR is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding HF Sinclair Corp and NCR Voyix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NCR Voyix 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 NCR Voyix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NCR Voyix has no effect on the direction of HF Sinclair i.e., HF Sinclair and NCR Voyix go up and down completely randomly.

Pair Corralation between HF Sinclair and NCR Voyix

Given the investment horizon of 90 days HF Sinclair Corp is expected to under-perform the NCR Voyix. But the stock apears to be less risky and, when comparing its historical volatility, HF Sinclair Corp is 1.25 times less risky than NCR Voyix. The stock trades about -0.37 of its potential returns per unit of risk. The NCR Voyix is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest  1,458  in NCR Voyix on October 9, 2024 and sell it today you would lose (69.00) from holding NCR Voyix or give up 4.73% 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.  NCR Voyix

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.

NCR Voyix

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in NCR Voyix are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, NCR Voyix is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with HF Sinclair and NCR Voyix

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

The idea behind HF Sinclair Corp and NCR Voyix 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.