Correlation Between Hafnia and MPC Energy

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Can any of the company-specific risk be diversified away by investing in both Hafnia and MPC 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 Hafnia and MPC Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hafnia and MPC Energy Solutions, you can compare the effects of market volatilities on Hafnia and MPC 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 Hafnia with a short position of MPC Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hafnia and MPC Energy.

Diversification Opportunities for Hafnia and MPC Energy

0.53
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Hafnia and MPC is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Hafnia and MPC Energy Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MPC Energy Solutions and Hafnia 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 Hafnia are associated (or correlated) with MPC Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MPC Energy Solutions has no effect on the direction of Hafnia i.e., Hafnia and MPC Energy go up and down completely randomly.

Pair Corralation between Hafnia and MPC Energy

Assuming the 90 days trading horizon Hafnia is expected to generate 14.62 times less return on investment than MPC Energy. But when comparing it to its historical volatility, Hafnia is 3.07 times less risky than MPC Energy. It trades about 0.02 of its potential returns per unit of risk. MPC Energy Solutions is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  932.00  in MPC Energy Solutions on September 2, 2025 and sell it today you would earn a total of  383.00  from holding MPC Energy Solutions or generate 41.09% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Hafnia  vs.  MPC Energy Solutions

 Performance 
       Timeline  
Hafnia 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Hafnia are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Hafnia is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.
MPC Energy Solutions 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in MPC Energy Solutions are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting basic indicators, MPC Energy displayed solid returns over the last few months and may actually be approaching a breakup point.

Hafnia and MPC Energy Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Hafnia and MPC Energy

The main advantage of trading using opposite Hafnia and MPC Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hafnia position performs unexpectedly, MPC 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 MPC Energy will offset losses from the drop in MPC Energy's long position.
The idea behind Hafnia and MPC Energy Solutions 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.
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 Global Correlations module to find global opportunities by holding instruments from different markets.

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