Correlation Between CVR Energy and Arcontech Group

Can any of the company-specific risk be diversified away by investing in both CVR Energy and Arcontech Group 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 CVR Energy and Arcontech Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CVR Energy and Arcontech Group Plc, you can compare the effects of market volatilities on CVR Energy and Arcontech Group 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 CVR Energy with a short position of Arcontech Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Energy and Arcontech Group.

Diversification Opportunities for CVR Energy and Arcontech Group

0.91

Correlation Coefficient

CVR Energy  Arcontech Group

Almost no diversification

The 3 months correlation between CVR and Arcontech is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding CVR Energy and Arcontech Group Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arcontech Group Plc and CVR 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 CVR Energy are associated (or correlated) with Arcontech Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arcontech Group Plc has no effect on the direction of CVR Energy i.e., CVR Energy and Arcontech Group go up and down completely randomly.

Pair Corralation between CVR Energy and Arcontech Group

Assuming the 90 days trading horizon CVR Energy is expected to generate 1.6 times more return on investment than Arcontech Group. However, CVR Energy is 1.6 times more volatile than Arcontech Group Plc. It trades about 0.33 of its potential returns per unit of risk. Arcontech Group Plc is currently generating about 0.16 per unit of risk. If you would invest  1,761  in CVR Energy on April 23, 2025 and sell it today you would earn a total of  1,096  from holding CVR Energy or generate 62.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	95.16%
Values	Daily Returns

CVR Energy  vs.  Arcontech Group Plc

CVR Energy

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in CVR Energy are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CVR Energy unveiled solid returns over the last few months and may actually be approaching a breakup point.

Arcontech Group Plc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Arcontech Group Plc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Arcontech Group exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CVR Energy and Arcontech Group

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

The idea behind CVR Energy and Arcontech Group Plc 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.