Correlation Between PBF Energy and Sunrun

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

Diversification Opportunities for PBF Energy and Sunrun

0.34
  Correlation Coefficient

Weak diversification

The 3 months correlation between PBF and Sunrun is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding PBF Energy and Sunrun Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunrun Inc and PBF 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 PBF Energy are associated (or correlated) with Sunrun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunrun Inc has no effect on the direction of PBF Energy i.e., PBF Energy and Sunrun go up and down completely randomly.

Pair Corralation between PBF Energy and Sunrun

Considering the 90-day investment horizon PBF Energy is expected to generate 0.83 times more return on investment than Sunrun. However, PBF Energy is 1.2 times less risky than Sunrun. It trades about 0.16 of its potential returns per unit of risk. Sunrun Inc is currently generating about 0.05 per unit of risk. If you would invest  2,465  in PBF Energy on August 26, 2025 and sell it today you would earn a total of  1,006  from holding PBF Energy or generate 40.81% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

PBF Energy  vs.  Sunrun Inc

 Performance 
       Timeline  
PBF Energy 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in PBF Energy are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental drivers, PBF Energy reported solid returns over the last few months and may actually be approaching a breakup point.
Sunrun Inc 

Risk-Adjusted Performance

Soft

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Sunrun Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Sunrun displayed solid returns over the last few months and may actually be approaching a breakup point.

PBF Energy and Sunrun Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with PBF Energy and Sunrun

The main advantage of trading using opposite PBF Energy and Sunrun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PBF Energy position performs unexpectedly, Sunrun 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 Sunrun will offset losses from the drop in Sunrun's long position.
The idea behind PBF Energy and Sunrun Inc 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.

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