Correlation Between MRC Global and Delek Logistics

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

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

Diversification Opportunities for MRC Global and Delek Logistics

0.75

Correlation Coefficient

MRC Global  Delek Logistics

Poor diversification

The 3 months correlation between MRC and Delek is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding MRC Global and Delek Logistics Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delek Logistics Partners and MRC Global 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 MRC Global are associated (or correlated) with Delek Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delek Logistics Partners has no effect on the direction of MRC Global i.e., MRC Global and Delek Logistics go up and down completely randomly.

Pair Corralation between MRC Global and Delek Logistics

Considering the 90-day investment horizon MRC Global is expected to generate 1.08 times less return on investment than Delek Logistics. In addition to that, MRC Global is 2.3 times more volatile than Delek Logistics Partners. It trades about 0.09 of its total potential returns per unit of risk. Delek Logistics Partners is currently generating about 0.22 per unit of volatility. If you would invest  3,738  in Delek Logistics Partners on May 5, 2025 and sell it today you would earn a total of  693.00  from holding Delek Logistics Partners or generate 18.54% return on investment over 90 days.

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

MRC Global  vs.  Delek Logistics Partners

MRC Global

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MRC Global are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal basic indicators, MRC Global exhibited solid returns over the last few months and may actually be approaching a breakup point.

Delek Logistics Partners

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Delek Logistics Partners are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite quite inconsistent forward-looking signals, Delek Logistics disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MRC Global and Delek Logistics

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

The idea behind MRC Global and Delek Logistics Partners 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.