Correlation Between Blue Apron and Vertex Energy

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

Diversification Opportunities for Blue Apron and Vertex Energy

-0.48
  Correlation Coefficient

Very good diversification

The 3 months correlation between Blue Apron and Vertex is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Blue Apron Holdings and Vertex Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vertex Energy and Blue Apron 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 Blue Apron Holdings are associated (or correlated) with Vertex Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vertex Energy has no effect on the direction of Blue Apron i.e., Blue Apron and Vertex Energy go up and down completely randomly.

Pair Corralation between Blue Apron and Vertex Energy

Given the investment horizon of 90 days Blue Apron Holdings is expected to generate 0.79 times more return on investment than Vertex Energy. However, Blue Apron Holdings is 1.26 times less risky than Vertex Energy. It trades about 0.09 of its potential returns per unit of risk. Vertex Energy is currently generating about -0.14 per unit of risk. If you would invest  263.00  in Blue Apron Holdings on May 11, 2022 and sell it today you would earn a total of  44.00  from holding Blue Apron Holdings or generate 16.73% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Blue Apron Holdings  vs.  Vertex Energy

 Performance (%) 
       Timeline  
Blue Apron Holdings 
Blue Apron Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Blue Apron Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile basic indicators, Blue Apron may actually be approaching a critical reversion point that can send shares even higher in September 2022.

Blue Apron Price Channel

Vertex Energy 
Vertex Performance
0 of 100
Over the last 90 days Vertex Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Vertex Price Channel

Blue Apron and Vertex Energy Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Blue Apron and Vertex Energy

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

Vertex Energy

Pair trading matchups for Vertex Energy

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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.

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