Correlation Between Exxon and SCOTTS
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By analyzing existing cross correlation between Exxon Mobil Corp and SCOTTS MIRACLE GRO 45, you can compare the effects of market volatilities on Exxon and SCOTTS 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 SCOTTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and SCOTTS.
Diversification Opportunities for Exxon and SCOTTS
Significant diversification
The 3 months correlation between Exxon and SCOTTS is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and SCOTTS MIRACLE GRO 45 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCOTTS MIRACLE GRO 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 SCOTTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCOTTS MIRACLE GRO has no effect on the direction of Exxon i.e., Exxon and SCOTTS go up and down completely randomly.
Pair Corralation between Exxon and SCOTTS
Considering the 90-day investment horizon Exxon Mobil Corp is expected to generate 1.33 times more return on investment than SCOTTS. However, Exxon is 1.33 times more volatile than SCOTTS MIRACLE GRO 45. It trades about 0.04 of its potential returns per unit of risk. SCOTTS MIRACLE GRO 45 is currently generating about 0.0 per unit of risk. If you would invest 10,207 in Exxon Mobil Corp on September 1, 2024 and sell it today you would earn a total of 1,589 from holding Exxon Mobil Corp or generate 15.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Exxon Mobil Corp vs. SCOTTS MIRACLE GRO 45
Performance |
| Timeline |
| Exxon Mobil Corp |
| SCOTTS MIRACLE GRO |
Exxon and SCOTTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and SCOTTS
The main advantage of trading using opposite Exxon and SCOTTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, SCOTTS 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 SCOTTS will offset losses from the drop in SCOTTS's long position.| Exxon vs. Shell PLC ADR | Exxon vs. BP PLC ADR | Exxon vs. Suncor Energy | Exxon vs. Petroleo Brasileiro Petrobras |
| SCOTTS vs. Amkor Technology | SCOTTS vs. ServiceNow | SCOTTS vs. Papaya Growth Opportunity | SCOTTS vs. Griffon |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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