Correlation Between HF SINCLAIR and Elmos Semiconductor

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

By analyzing existing cross correlation between HF SINCLAIR P and Elmos Semiconductor SE, you can compare the effects of market volatilities on HF SINCLAIR and Elmos Semiconductor 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 Elmos Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF SINCLAIR and Elmos Semiconductor.

Diversification Opportunities for HF SINCLAIR and Elmos Semiconductor

-0.6

Correlation Coefficient

HF SINCLAIR  Elmos Semiconductor

Excellent diversification

The 3 months correlation between HL80 and Elmos is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding HF SINCLAIR P and Elmos Semiconductor SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elmos Semiconductor 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 P are associated (or correlated) with Elmos Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elmos Semiconductor has no effect on the direction of HF SINCLAIR i.e., HF SINCLAIR and Elmos Semiconductor go up and down completely randomly.

Pair Corralation between HF SINCLAIR and Elmos Semiconductor

Assuming the 90 days trading horizon HF SINCLAIR P is expected to generate 1.19 times more return on investment than Elmos Semiconductor. However, HF SINCLAIR is 1.19 times more volatile than Elmos Semiconductor SE. It trades about -0.02 of its potential returns per unit of risk. Elmos Semiconductor SE is currently generating about -0.08 per unit of risk. If you would invest  3,440  in HF SINCLAIR P on December 2, 2024 and sell it today you would lose (80.00) from holding HF SINCLAIR P or give up 2.33% of portfolio value over 90 days.

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

HF SINCLAIR P  vs.  Elmos Semiconductor SE

HF SINCLAIR P

Risk-Adjusted Performance

Very Weak

Over the last 90 days HF SINCLAIR P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Elmos Semiconductor

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Elmos Semiconductor SE are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Elmos Semiconductor unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HF SINCLAIR and Elmos Semiconductor

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

The idea behind HF SINCLAIR P and Elmos Semiconductor SE 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.