Correlation Analysis Between Exxon and Merck

This module allows you to analyze existing cross correlation between Exxon Mobil Corporation and Merck Company. You can compare the effects of market volatilities on Exxon and Merck 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 Merck. See also your portfolio center. Please also check ongoing floating volatility patterns of Exxon and Merck.
Horizon     30 Days    Login   to change
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Comparative Performance

Exxon Mobil  

Risk-Adjusted Performance

Over the last 30 days Exxon Mobil Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. Even with considerably steady technical indicators, Exxon is not utilizing all of its potentials. The existing stock price chaos, may contribute to medium term losses for the stakeholders.

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Merck Company are ranked lower than 3 (%) of all global equities and portfolios over the last 30 days. Regardless of fairly consistent technical and fundamental indicators, Merck is not utilizing all of its potentials. The ongoing stock price confusion, may contribute to short-horizon losses for the traders.

Exxon and Merck Volatility Contrast

 Predicted Return Density 

Exxon Mobil Corp.  vs.  Merck Company Inc

 Performance (%) 

Pair Volatility

Considering 30-days investment horizon, Exxon Mobil Corporation is expected to under-perform the Merck. In addition to that, Exxon is 1.11 times more volatile than Merck Company. It trades about -0.07 of its total potential returns per unit of risk. Merck Company is currently generating about 0.05 per unit of volatility. If you would invest  8,203  in Merck Company on September 21, 2019 and sell it today you would earn a total of  249.00  from holding Merck Company or generate 3.04% return on investment over 30 days.

Pair Corralation between Exxon and Merck

Time Period3 Months [change]
StrengthVery Weak
ValuesDaily Returns

Diversification Opportunities for Exxon and Merck

Exxon Mobil Corp. diversification synergy

Excellent diversification

Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp. and Merck Company Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Merck 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 Corporation are associated (or correlated) with Merck. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Merck has no effect on the direction of Exxon i.e. Exxon and Merck go up and down completely randomly.
See also your portfolio center. Please also try Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.