Correlation Between Exxon and MASCO
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By analyzing existing cross correlation between Exxon Mobil Corp and MASCO P 775, you can compare the effects of market volatilities on Exxon and MASCO 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 MASCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and MASCO.
Diversification Opportunities for Exxon and MASCO
Excellent diversification
The 3 months correlation between Exxon and MASCO is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and MASCO P 775 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MASCO P 775 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 MASCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MASCO P 775 has no effect on the direction of Exxon i.e., Exxon and MASCO go up and down completely randomly.
Pair Corralation between Exxon and MASCO
Considering the 90-day investment horizon Exxon Mobil Corp is expected to generate 2.05 times more return on investment than MASCO. However, Exxon is 2.05 times more volatile than MASCO P 775. It trades about 0.07 of its potential returns per unit of risk. MASCO P 775 is currently generating about 0.06 per unit of risk. If you would invest 11,574 in Exxon Mobil Corp on August 31, 2024 and sell it today you would earn a total of 192.00 from holding Exxon Mobil Corp or generate 1.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Exxon Mobil Corp vs. MASCO P 775
Performance |
| Timeline |
| Exxon Mobil Corp |
| MASCO P 775 |
Exxon and MASCO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and MASCO
The main advantage of trading using opposite Exxon and MASCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, MASCO 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 MASCO will offset losses from the drop in MASCO's long position.| Exxon vs. RLJ Lodging Trust | Exxon vs. Aquagold International | Exxon vs. Stepstone Group | Exxon vs. Morningstar Unconstrained Allocation |
| MASCO vs. Dolphin Entertainment | MASCO vs. National CineMedia | MASCO vs. Organic Sales and | MASCO vs. BCE Inc |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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