Correlation Between Exxon and Golden Dawn
Can any of the company-specific risk be diversified away by investing in both Exxon and Golden Dawn 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 Exxon and Golden Dawn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exxon Mobil Corp and Golden Dawn Minerals, you can compare the effects of market volatilities on Exxon and Golden Dawn 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 Exxon with a short position of Golden Dawn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and Golden Dawn.
Diversification Opportunities for Exxon and Golden Dawn
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Exxon and Golden is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and Golden Dawn Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Dawn Minerals and Exxon 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 Exxon Mobil Corp are associated (or correlated) with Golden Dawn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Dawn Minerals has no effect on the direction of Exxon i.e., Exxon and Golden Dawn go up and down completely randomly.
Pair Corralation between Exxon and Golden Dawn
Considering the 90-day investment horizon Exxon Mobil Corp is expected to generate 1.29 times more return on investment than Golden Dawn. However, Exxon is 1.29 times more volatile than Golden Dawn Minerals. It trades about -0.03 of its potential returns per unit of risk. Golden Dawn Minerals is currently generating about -0.13 per unit of risk. If you would invest 11,159 in Exxon Mobil Corp on September 21, 2024 and sell it today you would lose (569.00) from holding Exxon Mobil Corp or give up 5.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 51.4% |
| Values | Daily Returns |
Exxon Mobil Corp vs. Golden Dawn Minerals
Performance |
| Timeline |
| Exxon Mobil Corp |
| Golden Dawn Minerals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Exxon and Golden Dawn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and Golden Dawn
The main advantage of trading using opposite Exxon and Golden Dawn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, Golden Dawn 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 Golden Dawn will offset losses from the drop in Golden Dawn's long position.| Exxon vs. Aquagold International | Exxon vs. Thrivent High Yield | Exxon vs. Morningstar Unconstrained Allocation | Exxon vs. Via Renewables |
| Golden Dawn vs. Canada Silver Cobalt | Golden Dawn vs. Cantex Mine Development | Golden Dawn vs. CopAur Minerals | Golden Dawn vs. Argosy Minerals Limited |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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