Correlation Between Invesco Oppenheimer and Exxon

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

Diversification Opportunities for Invesco Oppenheimer and Exxon

0.6
  Correlation Coefficient

Poor diversification

The 3 months correlation between Invesco and Exxon is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Oppenheimer Portfolio 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 Invesco Oppenheimer 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 Invesco Oppenheimer Portfolio 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 Invesco Oppenheimer i.e., Invesco Oppenheimer and Exxon go up and down completely randomly.

Pair Corralation between Invesco Oppenheimer and Exxon

Assuming the 90 days horizon Invesco Oppenheimer Portfolio is expected to generate 0.35 times more return on investment than Exxon. However, Invesco Oppenheimer Portfolio is 2.88 times less risky than Exxon. It trades about 0.34 of its potential returns per unit of risk. Exxon Mobil Corp is currently generating about 0.08 per unit of risk. If you would invest  1,227  in Invesco Oppenheimer Portfolio on May 10, 2022 and sell it today you would earn a total of  69.00  from holding Invesco Oppenheimer Portfolio or generate 5.62% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Invesco Oppenheimer Portfolio  vs.  Exxon Mobil Corp

 Performance (%) 
       Timeline  
Invesco Oppenheimer 
Invesco Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Invesco Oppenheimer Portfolio are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Invesco Oppenheimer is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Invesco Price Channel

Exxon Mobil Corp 
Exxon Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Exxon Mobil Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Exxon may actually be approaching a critical reversion point that can send shares even higher in September 2022.

Exxon Price Channel

Invesco Oppenheimer and Exxon Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Invesco Oppenheimer and Exxon

The main advantage of trading using opposite Invesco Oppenheimer and Exxon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Oppenheimer 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.

Invesco Oppenheimer Portfolio

Pair trading matchups for Invesco Oppenheimer

The idea behind Invesco Oppenheimer Portfolio 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.

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