Correlation Between Exxon and Kibush Capital

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

Diversification Opportunities for Exxon and Kibush Capital

-0.45
  Correlation Coefficient

Very good diversification

The 3 months correlation between Exxon and Kibush is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and Kibush Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kibush Capital Corp 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 Kibush Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kibush Capital Corp has no effect on the direction of Exxon i.e., Exxon and Kibush Capital go up and down completely randomly.

Pair Corralation between Exxon and Kibush Capital

Considering the 90-day investment horizon Exxon is expected to generate 10.68 times less return on investment than Kibush Capital. But when comparing it to its historical volatility, Exxon Mobil Corp is 8.1 times less risky than Kibush Capital. It trades about 0.04 of its potential returns per unit of risk. Kibush Capital Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  0.05  in Kibush Capital Corp on September 5, 2022 and sell it today you would lose (0.02)  from holding Kibush Capital Corp or give up 40.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy99.21%
ValuesDaily Returns

Exxon Mobil Corp  vs.  Kibush Capital Corp

 Performance (%) 
       Timeline  
Exxon Mobil Corp 
Exxon Performance
9 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Exxon Mobil Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Exxon revealed solid returns over the last few months and may actually be approaching a breakup point.

Exxon Price Channel

Kibush Capital Corp 
Kibush Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Kibush Capital Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak fundamental indicators, Kibush Capital reported solid returns over the last few months and may actually be approaching a breakup point.

Kibush Price Channel

Exxon and Kibush Capital Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Exxon and Kibush Capital

The main advantage of trading using opposite Exxon and Kibush Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, Kibush Capital 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 Kibush Capital will offset losses from the drop in Kibush Capital's long position.
Exxon vs. Transportadora De Gas
Exxon vs. China Petroleum Chemical
Exxon vs. National Fuel Gas
Exxon vs. A-Cap Energy
The idea behind Exxon Mobil Corp and Kibush Capital 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.
Kibush Capital vs. Alcoa Corp
Kibush Capital vs. Dupont De Nemours
Kibush Capital vs. Linde PLC
Kibush Capital vs. Anheuser Busch Inbev
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.

Other Complementary Tools

Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Go
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Go
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Go
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Go
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Go
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios
Go
Probability Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Go
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Go
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
Go