Correlation Between Delek Energy and Crossamerica Partners

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

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

Diversification Opportunities for Delek Energy and Crossamerica Partners

-0.49

Correlation Coefficient

Delek Energy  Crossamerica Partners

Very good diversification

The 3 months correlation between Delek and Crossamerica is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Delek Energy and Crossamerica Partners LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crossamerica Partners and Delek Energy 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 Energy are associated (or correlated) with Crossamerica Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crossamerica Partners has no effect on the direction of Delek Energy i.e., Delek Energy and Crossamerica Partners go up and down completely randomly.

Pair Corralation between Delek Energy and Crossamerica Partners

Allowing for the 90-day total investment horizon Delek Energy is expected to under-perform the Crossamerica Partners. In addition to that, Delek Energy is 2.46 times more volatile than Crossamerica Partners LP. It trades about -0.17 of its total potential returns per unit of risk. Crossamerica Partners LP is currently generating about 0.01 per unit of volatility. If you would invest  2,177  in Crossamerica Partners LP on January 9, 2025 and sell it today you would earn a total of  0.00  from holding Crossamerica Partners LP or generate 0.0% return on investment over 90 days.

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

Delek Energy  vs.  Crossamerica Partners LP

Delek Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Delek Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in May 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Crossamerica Partners

Risk-Adjusted Performance

Weak

Over the last 90 days Crossamerica Partners LP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Crossamerica Partners is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Delek Energy and Crossamerica Partners

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

The idea behind Delek Energy and Crossamerica Partners LP 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.