Correlation Between Exxon and WALMART
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By analyzing existing cross correlation between Exxon Mobil Corp and WALMART INC 62, you can compare the effects of market volatilities on Exxon and WALMART 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 WALMART. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and WALMART.
Diversification Opportunities for Exxon and WALMART
Excellent diversification
The 3 months correlation between Exxon and WALMART is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and WALMART INC 62 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WALMART INC 62 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 WALMART. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WALMART INC 62 has no effect on the direction of Exxon i.e., Exxon and WALMART go up and down completely randomly.
Pair Corralation between Exxon and WALMART
Considering the 90-day investment horizon Exxon Mobil Corp is expected to generate 1.24 times more return on investment than WALMART. However, Exxon is 1.24 times more volatile than WALMART INC 62. It trades about 0.04 of its potential returns per unit of risk. WALMART INC 62 is currently generating about 0.01 per unit of risk. If you would invest 9,714 in Exxon Mobil Corp on August 27, 2024 and sell it today you would earn a total of 2,465 from holding Exxon Mobil Corp or generate 25.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 88.71% |
| Values | Daily Returns |
Exxon Mobil Corp vs. WALMART INC 62
Performance |
| Timeline |
| Exxon Mobil Corp |
| WALMART INC 62 |
Exxon and WALMART Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and WALMART
The main advantage of trading using opposite Exxon and WALMART positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, WALMART 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 WALMART will offset losses from the drop in WALMART's long position.The idea behind Exxon Mobil Corp and WALMART INC 62 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.| WALMART vs. Ainsworth Game Technology | WALMART vs. Anheuser Busch Inbev | WALMART vs. Ultra Clean Holdings | WALMART vs. Wicket Gaming AB |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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