Correlation Between Exxon and UNITED
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By analyzing existing cross correlation between Exxon Mobil Corp and UNITED TECHNOLOGIES P, you can compare the effects of market volatilities on Exxon and UNITED 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 UNITED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and UNITED.
Diversification Opportunities for Exxon and UNITED
Very good diversification
The 3 months correlation between Exxon and UNITED is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and UNITED TECHNOLOGIES P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED TECHNOLOGIES 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 UNITED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED TECHNOLOGIES has no effect on the direction of Exxon i.e., Exxon and UNITED go up and down completely randomly.
Pair Corralation between Exxon and UNITED
Considering the 90-day investment horizon Exxon Mobil Corp is expected to generate 0.96 times more return on investment than UNITED. However, Exxon Mobil Corp is 1.04 times less risky than UNITED. It trades about 0.07 of its potential returns per unit of risk. UNITED TECHNOLOGIES P is currently generating about 0.02 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 | 95.45% |
| Values | Daily Returns |
Exxon Mobil Corp vs. UNITED TECHNOLOGIES P
Performance |
| Timeline |
| Exxon Mobil Corp |
| UNITED TECHNOLOGIES |
Exxon and UNITED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and UNITED
The main advantage of trading using opposite Exxon and UNITED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, UNITED 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 UNITED will offset losses from the drop in UNITED's long position.| Exxon vs. RLJ Lodging Trust | Exxon vs. Aquagold International | Exxon vs. Stepstone Group | Exxon vs. Morningstar Unconstrained Allocation |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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