Correlation Between Exxon and INTNED

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Exxon and INTNED at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Exxon and INTNED into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exxon Mobil Corp and INTNED 4625 06 JAN 26, you can compare the effects of market volatilities on Exxon and INTNED 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 INTNED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and INTNED.

Diversification Opportunities for Exxon and INTNED

0.66
  Correlation Coefficient

Poor diversification

The 3 months correlation between Exxon and INTNED is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and INTNED 4625 06 JAN 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTNED 4625 06 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 INTNED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTNED 4625 06 has no effect on the direction of Exxon i.e., Exxon and INTNED go up and down completely randomly.

Pair Corralation between Exxon and INTNED

Considering the 90-day investment horizon Exxon Mobil Corp is expected to under-perform the INTNED. In addition to that, Exxon is 4.51 times more volatile than INTNED 4625 06 JAN 26. It trades about -0.07 of its total potential returns per unit of risk. INTNED 4625 06 JAN 26 is currently generating about -0.13 per unit of volatility. If you would invest  10,028  in INTNED 4625 06 JAN 26 on September 19, 2024 and sell it today you would lose (166.00) from holding INTNED 4625 06 JAN 26 or give up 1.66% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy74.6%
ValuesDaily Returns

Exxon Mobil Corp  vs.  INTNED 4625 06 JAN 26

 Performance 
       Timeline  
Exxon Mobil Corp 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Exxon Mobil Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Exxon is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.
INTNED 4625 06 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days INTNED 4625 06 JAN 26 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, INTNED is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Exxon and INTNED Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Exxon and INTNED

The main advantage of trading using opposite Exxon and INTNED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, INTNED 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 INTNED will offset losses from the drop in INTNED's long position.
The idea behind Exxon Mobil Corp and INTNED 4625 06 JAN 26 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.
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

Other Complementary Tools

Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Money Managers
Screen money managers from public funds and ETFs managed around the world
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio