Correlation Between Exxon and 594918AD6
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By analyzing existing cross correlation between Exxon Mobil Corp and MICROSOFT P 52, you can compare the effects of market volatilities on Exxon and 594918AD6 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 594918AD6. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and 594918AD6.
Diversification Opportunities for Exxon and 594918AD6
Excellent diversification
The 3 months correlation between Exxon and 594918AD6 is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and MICROSOFT P 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MICROSOFT P 52 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 594918AD6. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MICROSOFT P 52 has no effect on the direction of Exxon i.e., Exxon and 594918AD6 go up and down completely randomly.
Pair Corralation between Exxon and 594918AD6
Considering the 90-day investment horizon Exxon Mobil Corp is expected to generate 1.49 times more return on investment than 594918AD6. However, Exxon is 1.49 times more volatile than MICROSOFT P 52. It trades about 0.05 of its potential returns per unit of risk. MICROSOFT P 52 is currently generating about 0.06 per unit of risk. If you would invest 11,301 in Exxon Mobil Corp on August 25, 2024 and sell it today you would earn a total of 878.00 from holding Exxon Mobil Corp or generate 7.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Exxon Mobil Corp vs. MICROSOFT P 52
Performance |
| Timeline |
| Exxon Mobil Corp |
| MICROSOFT P 52 |
Exxon and 594918AD6 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and 594918AD6
The main advantage of trading using opposite Exxon and 594918AD6 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, 594918AD6 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 594918AD6 will offset losses from the drop in 594918AD6's long position.| Exxon vs. Shell PLC ADR | Exxon vs. BP PLC ADR | Exxon vs. Suncor Energy | Exxon vs. Petroleo Brasileiro Petrobras |
| 594918AD6 vs. The Coca Cola | 594918AD6 vs. JPMorgan Chase Co | 594918AD6 vs. Dupont De Nemours | 594918AD6 vs. Alcoa Corp |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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