Correlation Between Delek Energy and SM Energy
Can any of the company-specific risk be diversified away by investing in both Delek Energy and SM 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 Delek Energy and SM Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delek Energy and SM Energy Co, you can compare the effects of market volatilities on Delek Energy and SM 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 Delek Energy with a short position of SM Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delek Energy and SM Energy.
Diversification Opportunities for Delek Energy and SM Energy
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Delek and SM Energy is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Delek Energy and SM Energy Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SM Energy 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 SM Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SM Energy has no effect on the direction of Delek Energy i.e., Delek Energy and SM Energy go up and down completely randomly.
Pair Corralation between Delek Energy and SM Energy
Allowing for the 90-day total investment horizon Delek Energy is expected to generate 1.01 times more return on investment than SM Energy. However, Delek Energy is 1.01 times more volatile than SM Energy Co. It trades about -0.05 of its potential returns per unit of risk. SM Energy Co is currently generating about -0.11 per unit of risk. If you would invest 3,211 in Delek Energy on October 10, 2025 and sell it today you would lose (287.00) from holding Delek Energy or give up 8.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delek Energy vs. SM Energy Co
Performance |
| Timeline |
| Delek Energy |
| SM Energy |
Delek Energy and SM Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delek Energy and SM Energy
The main advantage of trading using opposite Delek Energy and SM Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delek Energy position performs unexpectedly, SM 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 SM Energy will offset losses from the drop in SM Energy's long position.| Delek Energy vs. Cosan SA ADR | Delek Energy vs. Patterson UTI Energy | Delek Energy vs. Par Pacific Holdings | Delek Energy vs. Delek Logistics Partners |
| SM Energy vs. Northern Oil Gas | SM Energy vs. Crescent Energy Co | SM Energy vs. Civitas Resources | SM Energy vs. BKV Corporation |
Check out your portfolio center.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 Transaction History module to view history of all your transactions and understand their impact on performance.
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