Correlation Between Exxon and Mmngx

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

Diversification Opportunities for Exxon and Mmngx

0.58

Correlation Coefficient

Exxon  Mmngx

Very weak diversification

The 3 months correlation between Exxon and Mmngx is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Exxon Mobil Corp and Mmngx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mmngx 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 Mmngx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mmngx has no effect on the direction of Exxon i.e., Exxon and Mmngx go up and down completely randomly.

Pair Corralation between Exxon and Mmngx

Considering the 90-day investment horizon Exxon Mobil Corp is expected to under-perform the Mmngx. In addition to that, Exxon is 1.57 times more volatile than Mmngx. It trades about -0.02 of its total potential returns per unit of risk. Mmngx is currently generating about 0.07 per unit of volatility. If you would invest  1,841  in Mmngx on May 15, 2025 and sell it today you would earn a total of  66.00  from holding Mmngx or generate 3.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.39%
Values	Daily Returns

Exxon Mobil Corp  vs.  Mmngx

Exxon Mobil Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days Exxon Mobil Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Exxon is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Mmngx

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Mmngx are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Mmngx is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Exxon and Mmngx

The main advantage of trading using opposite Exxon and Mmngx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, Mmngx 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 Mmngx will offset losses from the drop in Mmngx's long position.

The idea behind Exxon Mobil Corp and Mmngx 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.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.