Correlation Between Exxon and Agilent Technologies

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Exxon and Agilent Technologies 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 Agilent Technologies 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 Agilent Technologies, you can compare the effects of market volatilities on Exxon and Agilent Technologies 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 Agilent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and Agilent Technologies.

Diversification Opportunities for Exxon and Agilent Technologies

0.75
  Correlation Coefficient

Poor diversification

The 3 months correlation between Exxon and Agilent is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and Agilent Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agilent Technologies 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 Agilent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agilent Technologies has no effect on the direction of Exxon i.e., Exxon and Agilent Technologies go up and down completely randomly.

Pair Corralation between Exxon and Agilent Technologies

Considering the 90-day investment horizon Exxon Mobil Corp is expected to generate 0.61 times more return on investment than Agilent Technologies. However, Exxon Mobil Corp is 1.63 times less risky than Agilent Technologies. It trades about 0.51 of its potential returns per unit of risk. Agilent Technologies is currently generating about 0.31 per unit of risk. If you would invest  10,275  in Exxon Mobil Corp on December 20, 2023 and sell it today you would earn a total of  955.00  from holding Exxon Mobil Corp or generate 9.29% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Exxon Mobil Corp  vs.  Agilent Technologies

 Performance 
       Timeline  
Exxon Mobil Corp 

Risk-Adjusted Performance

13 of 100

 
Low
 
High
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Exxon Mobil Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Exxon may actually be approaching a critical reversion point that can send shares even higher in April 2024.
Agilent Technologies 

Risk-Adjusted Performance

5 of 100

 
Low
 
High
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Agilent Technologies are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Agilent Technologies may actually be approaching a critical reversion point that can send shares even higher in April 2024.

Exxon and Agilent Technologies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Exxon and Agilent Technologies

The main advantage of trading using opposite Exxon and Agilent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, Agilent Technologies 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 Agilent Technologies will offset losses from the drop in Agilent Technologies' long position.
The idea behind Exxon Mobil Corp and Agilent Technologies 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.

Other Complementary Tools

Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
USA ETFs
Find actively traded Exchange Traded Funds (ETF) in USA
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Portfolio Optimization
Compute new portfolio that will generate highest expected return given your specified tolerance for risk
Bonds Directory
Find actively traded corporate debentures issued by US companies
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Pair Correlation
Compare performance and examine fundamental relationship between any two equity instruments
AI Investment Finder
Use AI to screen and filter profitable investment opportunities