Correlation Between Delek Drilling and Cohen Circle

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

By analyzing existing cross correlation between Delek Drilling and Cohen Circle Acquisition, you can compare the effects of market volatilities on Delek Drilling and Cohen Circle 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 Delek Drilling with a short position of Cohen Circle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Drilling and Cohen Circle.

Diversification Opportunities for Delek Drilling and Cohen Circle

0.5

Correlation Coefficient

Delek Drilling  Cohen Circle

Very weak diversification

The 3 months correlation between Delek and Cohen is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Delek Drilling and Cohen Circle Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cohen Circle Acquisition and Delek Drilling 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 Delek Drilling are associated (or correlated) with Cohen Circle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cohen Circle Acquisition has no effect on the direction of Delek Drilling i.e., Delek Drilling and Cohen Circle go up and down completely randomly.

Pair Corralation between Delek Drilling and Cohen Circle

Assuming the 90 days horizon Delek Drilling is expected to generate 4.57 times more return on investment than Cohen Circle. However, Delek Drilling is 4.57 times more volatile than Cohen Circle Acquisition. It trades about 0.06 of its potential returns per unit of risk. Cohen Circle Acquisition is currently generating about 0.07 per unit of risk. If you would invest  320.00  in Delek Drilling on October 10, 2024 and sell it today you would earn a total of  7.00  from holding Delek Drilling or generate 2.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.24%
Values	Daily Returns

Delek Drilling   vs.  Cohen Circle Acquisition

Delek Drilling

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Delek Drilling are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Delek Drilling reported solid returns over the last few months and may actually be approaching a breakup point.

Cohen Circle Acquisition

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cohen Circle Acquisition are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Cohen Circle is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Delek Drilling and Cohen Circle

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

The idea behind Delek Drilling and Cohen Circle Acquisition 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.