Correlation Between Uniserve Communications and Exxon

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

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

Diversification Opportunities for Uniserve Communications and Exxon

0.61

Correlation Coefficient

Uniserve Communications  Exxon

Poor diversification

The 3 months correlation between Uniserve and Exxon is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Uniserve Communications Corp and EXXON MOBIL CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EXXON MOBIL CDR and Uniserve Communications 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 Uniserve Communications 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 CDR has no effect on the direction of Uniserve Communications i.e., Uniserve Communications and Exxon go up and down completely randomly.

Pair Corralation between Uniserve Communications and Exxon

Assuming the 90 days horizon Uniserve Communications Corp is expected to generate 2.76 times more return on investment than Exxon. However, Uniserve Communications is 2.76 times more volatile than EXXON MOBIL CDR. It trades about 0.18 of its potential returns per unit of risk. EXXON MOBIL CDR is currently generating about 0.01 per unit of risk. If you would invest  28.00  in Uniserve Communications Corp on April 24, 2025 and sell it today you would earn a total of  14.00  from holding Uniserve Communications Corp or generate 50.0% return on investment over 90 days.

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

Uniserve Communications Corp  vs.  EXXON MOBIL CDR

Uniserve Communications

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Uniserve Communications Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Uniserve Communications showed solid returns over the last few months and may actually be approaching a breakup point.

EXXON MOBIL CDR

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in EXXON MOBIL CDR are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Exxon is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Uniserve Communications and Exxon

The main advantage of trading using opposite Uniserve Communications and Exxon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniserve Communications 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 Uniserve Communications Corp and EXXON MOBIL CDR 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.