Correlation Between HF Sinclair and Uranium Energy

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

Diversification Opportunities for HF Sinclair and Uranium Energy

-0.69

Correlation Coefficient

HF Sinclair  Uranium Energy

Excellent diversification

The 3 months correlation between DINO and Uranium is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding HF Sinclair Corp and Uranium Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uranium Energy Corp 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 Uranium Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uranium Energy Corp has no effect on the direction of HF Sinclair i.e., HF Sinclair and Uranium Energy go up and down completely randomly.

Pair Corralation between HF Sinclair and Uranium Energy

Given the investment horizon of 90 days HF Sinclair Corp is expected to under-perform the Uranium Energy. But the stock apears to be less risky and, when comparing its historical volatility, HF Sinclair Corp is 1.98 times less risky than Uranium Energy. The stock trades about -0.03 of its potential returns per unit of risk. The Uranium Energy Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  617.00  in Uranium Energy Corp on August 25, 2024 and sell it today you would earn a total of  229.00  from holding Uranium Energy Corp or generate 37.12% return on investment over 90 days.

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

HF Sinclair Corp  vs.  Uranium Energy Corp

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 latest conflicting performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Uranium Energy Corp

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Uranium Energy Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Uranium Energy exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HF Sinclair and Uranium Energy

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

The idea behind HF Sinclair Corp and Uranium Energy Corp 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.