Correlation Between Exxon and Agiliti

Can any of the company-specific risk be diversified away by investing in both Exxon and Agiliti 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 Agiliti 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 Agiliti, you can compare the effects of market volatilities on Exxon and Agiliti 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 Agiliti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and Agiliti.

Diversification Opportunities for Exxon and Agiliti

-0.35

Correlation Coefficient

Exxon  Agiliti

Very good diversification

The 3 months correlation between Exxon and Agiliti is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and Agiliti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agiliti 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 Agiliti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agiliti has no effect on the direction of Exxon i.e., Exxon and Agiliti go up and down completely randomly.

Pair Corralation between Exxon and Agiliti

If you would invest  11,179  in Exxon Mobil Corp on September 14, 2024 and sell it today you would earn a total of  3.00  from holding Exxon Mobil Corp or generate 0.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Exxon Mobil Corp  vs.  Agiliti

Exxon Mobil Corp

Risk-Adjusted Performance

0 of 100

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.

Agiliti

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Agiliti has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Agiliti is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Exxon and Agiliti

The main advantage of trading using opposite Exxon and Agiliti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, Agiliti 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 Agiliti will offset losses from the drop in Agiliti's long position.

The idea behind Exxon Mobil Corp and Agiliti 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.

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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..