Correlation Between Exxon and 345370CR9
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By analyzing existing cross correlation between Exxon Mobil Corp and Ford Motor Co, you can compare the effects of market volatilities on Exxon and 345370CR9 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 345370CR9. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and 345370CR9.
Diversification Opportunities for Exxon and 345370CR9
Very good diversification
The 3 months correlation between Exxon and 345370CR9 is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and Ford Motor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ford Motor 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 345370CR9. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ford Motor has no effect on the direction of Exxon i.e., Exxon and 345370CR9 go up and down completely randomly.
Pair Corralation between Exxon and 345370CR9
Considering the 90-day investment horizon Exxon Mobil Corp is expected to generate 1.21 times more return on investment than 345370CR9. However, Exxon is 1.21 times more volatile than Ford Motor Co. It trades about 0.15 of its potential returns per unit of risk. Ford Motor Co is currently generating about -0.17 per unit of risk. If you would invest 11,401 in Exxon Mobil Corp on September 2, 2024 and sell it today you would earn a total of 395.00 from holding Exxon Mobil Corp or generate 3.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Exxon Mobil Corp vs. Ford Motor Co
Performance |
| Timeline |
| Exxon Mobil Corp |
| Ford Motor |
Exxon and 345370CR9 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and 345370CR9
The main advantage of trading using opposite Exxon and 345370CR9 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, 345370CR9 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 345370CR9 will offset losses from the drop in 345370CR9's long position.The idea behind Exxon Mobil Corp and Ford Motor Co 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.| 345370CR9 vs. AEP TEX INC | 345370CR9 vs. US BANK NATIONAL | 345370CR9 vs. Bank of America | 345370CR9 vs. GE Aerospace |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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