Correlation Between Delek Logistics and Freightos Limited

Can any of the company-specific risk be diversified away by investing in both Delek Logistics and Freightos Limited 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 Freightos Limited 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 Freightos Limited Warrants, you can compare the effects of market volatilities on Delek Logistics and Freightos Limited 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 Freightos Limited. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Logistics and Freightos Limited.

Diversification Opportunities for Delek Logistics and Freightos Limited

0.57

Correlation Coefficient

Delek Logistics  Freightos Limited

Very weak diversification

The 3 months correlation between Delek and Freightos is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Delek Logistics Partners and Freightos Limited Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freightos Limited 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 Freightos Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freightos Limited has no effect on the direction of Delek Logistics i.e., Delek Logistics and Freightos Limited go up and down completely randomly.

Pair Corralation between Delek Logistics and Freightos Limited

Considering the 90-day investment horizon Delek Logistics Partners is expected to under-perform the Freightos Limited. But the stock apears to be less risky and, when comparing its historical volatility, Delek Logistics Partners is 12.43 times less risky than Freightos Limited. The stock trades about -0.06 of its potential returns per unit of risk. The Freightos Limited Warrants is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  8.88  in Freightos Limited Warrants on September 14, 2024 and sell it today you would earn a total of  6.81  from holding Freightos Limited Warrants or generate 76.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	53.13%
Values	Daily Returns

Delek Logistics Partners  vs.  Freightos Limited Warrants

Delek Logistics Partners

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Delek Logistics Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Freightos Limited

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Freightos Limited Warrants has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly unsteady basic indicators, Freightos Limited showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Delek Logistics and Freightos Limited

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

The idea behind Delek Logistics Partners and Freightos Limited Warrants 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.