Correlation Between Exxon and WELLPOINT
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By analyzing existing cross correlation between Exxon Mobil Corp and WELLPOINT INC 465, you can compare the effects of market volatilities on Exxon and WELLPOINT 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 WELLPOINT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and WELLPOINT.
Diversification Opportunities for Exxon and WELLPOINT
Very weak diversification
The 3 months correlation between Exxon and WELLPOINT is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and WELLPOINT INC 465 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WELLPOINT INC 465 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 WELLPOINT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WELLPOINT INC 465 has no effect on the direction of Exxon i.e., Exxon and WELLPOINT go up and down completely randomly.
Pair Corralation between Exxon and WELLPOINT
Considering the 90-day investment horizon Exxon is expected to generate 1.95 times less return on investment than WELLPOINT. But when comparing it to its historical volatility, Exxon Mobil Corp is 1.12 times less risky than WELLPOINT. It trades about 0.1 of its potential returns per unit of risk. WELLPOINT INC 465 is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 8,705 in WELLPOINT INC 465 on November 30, 2024 and sell it today you would earn a total of 932.00 from holding WELLPOINT INC 465 or generate 10.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
Exxon Mobil Corp vs. WELLPOINT INC 465
Performance |
| Timeline |
| Exxon Mobil Corp |
| WELLPOINT INC 465 |
Exxon and WELLPOINT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and WELLPOINT
The main advantage of trading using opposite Exxon and WELLPOINT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, WELLPOINT 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 WELLPOINT will offset losses from the drop in WELLPOINT's long position.| Exxon vs. BP PLC ADR | Exxon vs. Shell PLC ADR | Exxon vs. Petroleo Brasileiro Petrobras | Exxon vs. Suncor Energy |
| WELLPOINT vs. Hurco Companies | WELLPOINT vs. Cementos Pacasmayo SAA | WELLPOINT vs. Sun Country Airlines | WELLPOINT 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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