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Ranked as the 16th most valuable company in the world by market capitalisation (US$533.60 billion), Exxon Mobil (NYSE; ticker: XOM) is a US-based multinational organisation with an impressive 140-year history. The company was incorporated in the State of New Jersey in 1882.
Operating in more than 60 countries around the world and a workforce of 62,000 employees, Exxon Mobil primarily engages in gas and oil exploration, bringing together both upstream (exploration and production of crude oil and natural gas) and downstream (refining and marketing) operations.
CFDs, or ‘Contracts for Differences’, are leveraged financial derivative products. Offered on a wide range of underlying assets, including Currencies (Forex), Stock Indices, Commodities, Bonds, Exchange-Traded Funds (ETFs), Digital Currencies, and individual Stocks, such as Exxon Mobil, CFDs permit traders and investors to speculate and hedge across global markets.
The configuration of a CFD contract is straightforward. Traded over the counter (OTC), CFDs consist of two parties – a buyer and a seller – that agree to exchange the difference between a trade's opening and closing prices. An investor, therefore, can take a position, either entering long (buy) or short (sell), based on research of the underlying price movement of Exxon Mobil.
Trading CFDs is usually done using a margin account (leverage), and is one of the reasons behind their extensive appeal. Leverage allows you to control a greater position size with less capital; it is important to realise, however, that leverage can also amplify trading profits as well as losses. By way of a basic example, with FP Markets, Exxon Mobil can be traded by putting up only 20% of the initial investment amount (this is referred to as the initial margin). For example, if Exxon Mobil is trading at US$50.00 and you wanted to buy 50 shares of the company, with margin, instead of investing the full investment value of US$2,500, you could trade an equivalent position size in Exxon Mobil Share CFDs for US$500 (20% of the investment amount).
1. Open an FP Markets Forex and CFD Trading Account
To start investing in Share CFDs, opening a Forex and CFD trading account with FP Markets is the first step. Navigate to the main webpage and locate the ‘OPEN LIVE’ tab in the upper right corner to start your Account Application process.
2. Download your Trading Platform
The following step involves selecting and downloading your preferred trading platform. You can do this by logging in to the FP Markets Client Portal using the login credentials sent to your email ID. FP Markets offers a wide range of world-class platforms to choose from, though the majority of Share CFD investors prefer MetaTrader 5 (MT5) or cTrader.
3. Find the XOM Ticker
To find the XOM ticker on MT5, ensure that the platform is first open and connected to the correct server. Following this, open the Market Watch tab (Ctrl+M). If XOM is not visible, type ‘XOM’ at the bottom of the Market Watch, and this will create an additional row. Then drag and drop the stock to the chart’s main interface and alter its properties to suit your trading preferences.
4. Place the Buy or Sell Order
Although the one-click trading feature (Alt+T – image on the right below) is available on MT5 – largely favoured among short-term investors (for example, day traders and scalpers) – the most common approach to buying and selling Share CFDs on MT5 is through the order window (F9). As shown in the image on the left below, the order window enables the investor to enter several parameters before clicking the buy or sell button, such as order types and stop-loss values.
Share CFDs:
Exxon Mobil released its Q2 24 earnings on 2 August and posted impressive results. It was the second highest earnings performance in the past decade amid rising oil prices and the Pioneer Natural Resources acquisition (which was finalised in May this year), generating US$0.5 billion in earnings for the company.
Earnings rose by US$9.2 billion in Q2 24 (17%) from US$7.88 billion in Q2 23, with the company delivering a higher-than-expected US$2.14 per share profit (consensus: US$2.01), up from US$1.94 in Q2 23. The company also delivered record production in Guyana and the Permian. The report noted that ‘production increased by 15% or 574,000 oil-equivalent barrels per day, from the first quarter’. In terms of shareholder distributions, US$4.3 billion in dividends were paid out, along with US$5.2 billion in share buybacks.
Chairman and Chief Executive Officer Darren Woods commented: ‘We delivered our second-highest 2Q earnings of the past decade as we continue to improve the fundamental earnings power of the company’. Woods added: ‘We achieved record quarterly production from our low-cost-of-supply Permian and Guyana assets, with the highest oil production since the Exxon and Mobil merger. We also achieved a record in high-value product sales, growing by 10% versus the first half of last year. We closed on our transformative merger with Pioneer in about half the time of similar deals. And we’re continuing to build businesses such as Proxxima, carbon materials and virtually carbon-free hydrogen, with approximately 98% of CO2 removed, that will create value long into the future’.
Despite an optimistic Q2 24 report, Exxon Mobil delivered a cautioned investors concerning its upcoming Q3 24 earnings (scheduled to be released on 1 November). Considering recent declines in oil prices, the company outlined its expectations for a drop in upstream earnings between US$600 million and US$1 billion. However, 58% of analysts polled by Reuters are bullish on the stock. According to Refinitiv data, projections show that 17% of analysts recommend a ‘Strong Buy’, 41% recommend a ‘Buy’, 38% a ‘Hold’, and 4% a ‘Sell’. The stock's current mean (median) price target is US$130.75 (US$132.00).
Albeit upside momentum slowing considerably since late 2022, the share price recently climbed to an all-time high of US$126.34, reaffirming its long-standing uptrend before printing a modest correction to support (on low volume). Price action on the daily timeframe for XOM shows buyers and sellers competing for position at resistance-turned-support between US$118.96 and US$119.97.
Nearby current support, two merging trendline supports are visible (orange circle), derived from the all-time high and the low of US$107.77. Additionally, another layer of support is positioned just south of the noted lines at US$117.61.
Overall, the all-time high as well as the subsequent correction to support, could provide sufficient stimulus for buyers to consider entering fresh buy positions or ‘pyramiding’ existing longs.
Purchasing physical shares entitles investors to a ‘share’ of ownership in a company, such as Exxon Mobil. The value of the investment will fluctuate depending on the performance of the company’s shares. Stock investors may also be entitled to voting privileges and dividend payments.
Companies issue shares to raise money to fund growth and ultimately develop and are traded on stock exchanges – such as the New York Stock Exchange (NYSE) and London Stock Exchange (LSE).
Investing in Exxon Mobil through futures and options contracts is another alternative investment option, one which, unlike CFDs, can be physically settled (though it must be noted that most investors settle in cash before the expiration date).
A futures contract obligates both the buyer and seller to transact at a predetermined price before or at the expiration date, while an options contract provides the contract holder (the buyer) the right but no obligation to buy or sell the underlying asset at a predetermined price and future date. The obligation in an options contract falls on the seller (the writer) and is paid a premium by the buyer for this right.
ETFs are popular investment vehicles, a fund that trades on a stock exchange like common stocks. ETFs, therefore, have ticker symbols with price changes viewable throughout the day through bid and ask prices.
An ETF primarily pools money from investors to purchase a wide selection of investments similar to mutual funds, which can include Stocks, Bonds, Commodities, and more. Passively managed ETFs attempt to track an underlying index, thus offering investors a low-cost alternative to diversification without needing to purchase individual stocks. Investing in passive ETFs will not precisely mimic Exxon Mobil’s price movement, but it will allow investors to create a low-cost, diversified portfolio with ‘exposure’ to the stock.
1. Does XOM pay a dividend?
Yes, Exxon Mobil pays a dividend. As of writing, the company’s annual dividend yield is 3.15%.
2. What are the major differences between CFDs and physical shares?
Significant differences between CFDs and physical shares include ownership rights (CFDs are derivatives thus by investing in CFDs, you do not own the underlying asset; physical shares, on the other hand, bestow partial ownership of the company), leverage (CFDs offer greater leverage options than physical shares), as well as how they’re traded (CFDs trade OTC [no physical location], whereas physical shares are traded on a formal stock exchange).
3. Can I trade XOM on MT5?
With FP Markets, XOM can be traded on both MT5 and cTrader.
4. What are the trading hours for XOM?
The trading hours for XOM are between 16:30 and 23:00 GMT+3 (Monday-Friday).
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