Correlation Between Meta Platforms and Exxon

Can any of the company-specific risk be diversified away by investing in both Meta Platforms 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 Meta Platforms and Exxon into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Meta Platforms and Exxon Mobil Corp, you can compare the effects of market volatilities on Meta Platforms 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 Meta Platforms with a short position of Exxon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meta Platforms and Exxon.

Diversification Opportunities for Meta Platforms and Exxon

-0.65

Correlation Coefficient

Meta Platforms  Exxon

Excellent diversification

The 3 months correlation between Meta and Exxon is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Meta Platforms 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 Meta Platforms 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 Meta Platforms 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 Meta Platforms i.e., Meta Platforms and Exxon go up and down completely randomly.

Pair Corralation between Meta Platforms and Exxon

Given the investment horizon of 90 days Meta Platforms is expected to generate 1.65 times more return on investment than Exxon. However, Meta Platforms is 1.65 times more volatile than Exxon Mobil Corp. It trades about 0.16 of its potential returns per unit of risk. Exxon Mobil Corp is currently generating about -0.01 per unit of risk. If you would invest  60,946  in Meta Platforms on September 15, 2025 and sell it today you would earn a total of  3,477  from holding Meta Platforms or generate 5.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Meta Platforms  vs.  Exxon Mobil Corp

Meta Platforms

Risk-Adjusted Performance

Weakest

Over the last 90 days Meta Platforms has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2026. The current disturbance may also be a sign of long term up-swing for the company investors.

Exxon Mobil Corp

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Exxon Mobil Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Exxon may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Pair Trading with Meta Platforms and Exxon

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

The idea behind Meta Platforms 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.

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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.