Correlation Between Delek Logistics and 02209SBK8

Can any of the company-specific risk be diversified away by investing in both Delek Logistics and 02209SBK8 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 Logistics and 02209SBK8 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Delek Logistics Partners and US02209SBK87, you can compare the effects of market volatilities on Delek Logistics and 02209SBK8 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 Logistics with a short position of 02209SBK8. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Logistics and 02209SBK8.

Diversification Opportunities for Delek Logistics and 02209SBK8

0.16

Correlation Coefficient

Delek Logistics  02209SBK8

Average diversification

The 3 months correlation between Delek and 02209SBK8 is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Delek Logistics Partners and US02209SBK87 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US02209SBK87 and Delek Logistics 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 Logistics Partners are associated (or correlated) with 02209SBK8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US02209SBK87 has no effect on the direction of Delek Logistics i.e., Delek Logistics and 02209SBK8 go up and down completely randomly.

Pair Corralation between Delek Logistics and 02209SBK8

Considering the 90-day investment horizon Delek Logistics Partners is expected to generate 0.76 times more return on investment than 02209SBK8. However, Delek Logistics Partners is 1.31 times less risky than 02209SBK8. It trades about 0.11 of its potential returns per unit of risk. US02209SBK87 is currently generating about 0.02 per unit of risk. If you would invest  3,986  in Delek Logistics Partners on December 23, 2024 and sell it today you would earn a total of  381.00  from holding Delek Logistics Partners or generate 9.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

Delek Logistics Partners  vs.  US02209SBK87

Delek Logistics Partners

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Delek Logistics Partners are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite inconsistent forward-looking signals, Delek Logistics may actually be approaching a critical reversion point that can send shares even higher in April 2025.

US02209SBK87

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in US02209SBK87 are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 02209SBK8 is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Delek Logistics and 02209SBK8

The main advantage of trading using opposite Delek Logistics and 02209SBK8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek Logistics position performs unexpectedly, 02209SBK8 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 02209SBK8 will offset losses from the drop in 02209SBK8's long position.

The idea behind Delek Logistics Partners and US02209SBK87 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.