Correlation Between Bancfirst Corp and Exxon

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Can any of the company-specific risk be diversified away by investing in both Bancfirst Corp and Exxon 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 Bancfirst Corp and Exxon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bancfirst Corp and Exxon Mobil Corp, you can compare the effects of market volatilities on Bancfirst Corp and Exxon 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 Bancfirst Corp with a short position of Exxon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bancfirst Corp and Exxon.

Diversification Opportunities for Bancfirst Corp and Exxon

0.56
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Bancfirst and Exxon is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Bancfirst Corp and Exxon Mobil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exxon Mobil Corp and Bancfirst Corp 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 Bancfirst Corp are associated (or correlated) with Exxon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exxon Mobil Corp has no effect on the direction of Bancfirst Corp i.e., Bancfirst Corp and Exxon go up and down completely randomly.

Pair Corralation between Bancfirst Corp and Exxon

Given the investment horizon of 90 days Bancfirst Corp is expected to under-perform the Exxon. But the stock apears to be less risky and, when comparing its historical volatility, Bancfirst Corp is 1.13 times less risky than Exxon. The stock trades about -0.38 of its potential returns per unit of risk. The Exxon Mobil Corp is currently generating about -0.24 of returns per unit of risk over similar time horizon. If you would invest  10,012  in Exxon Mobil Corp on June 30, 2022 and sell it today you would lose (1,126)  from holding Exxon Mobil Corp or give up 11.25% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Bancfirst Corp  vs.  Exxon Mobil Corp

 Performance (%) 
       Timeline  
Bancfirst Corp 
Bancfirst Performance
0 of 100
Over the last 90 days Bancfirst Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Bancfirst Corp is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Bancfirst Price Channel

Exxon Mobil Corp 
Exxon Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Exxon Mobil Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively steady basic indicators, Exxon is not utilizing all of its potentials. The current stock price chaos, may contribute to medium-term losses for the stakeholders.

Exxon Price Channel

Bancfirst Corp and Exxon Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bancfirst Corp and Exxon

The main advantage of trading using opposite Bancfirst Corp and Exxon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bancfirst Corp position performs unexpectedly, Exxon 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 Exxon will offset losses from the drop in Exxon's long position.
Bancfirst Corp vs. Hdfc Bank
The idea behind Bancfirst Corp and Exxon Mobil Corp 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.

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