Correlation Between Curtiss Wright and Huntington Ingalls
Can any of the company-specific risk be diversified away by investing in both Curtiss Wright and Huntington Ingalls 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 Curtiss Wright and Huntington Ingalls into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Curtiss Wright and Huntington Ingalls Industries, you can compare the effects of market volatilities on Curtiss Wright and Huntington Ingalls 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 Curtiss Wright with a short position of Huntington Ingalls. Check out your portfolio center. Please also check ongoing floating volatility patterns of Curtiss Wright and Huntington Ingalls.
Diversification Opportunities for Curtiss Wright and Huntington Ingalls
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Curtiss and Huntington is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Curtiss Wright and Huntington Ingalls Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huntington Ingalls and Curtiss Wright 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 Curtiss Wright are associated (or correlated) with Huntington Ingalls. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huntington Ingalls has no effect on the direction of Curtiss Wright i.e., Curtiss Wright and Huntington Ingalls go up and down completely randomly.
Pair Corralation between Curtiss Wright and Huntington Ingalls
Allowing for the 90-day total investment horizon Curtiss Wright is expected to generate 0.65 times more return on investment than Huntington Ingalls. However, Curtiss Wright is 1.55 times less risky than Huntington Ingalls. It trades about 0.01 of its potential returns per unit of risk. Huntington Ingalls Industries is currently generating about -0.17 per unit of risk. If you would invest 35,192 in Curtiss Wright on November 9, 2024 and sell it today you would lose (162.00) from holding Curtiss Wright or give up 0.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Curtiss Wright vs. Huntington Ingalls Industries
Performance |
| Timeline |
| Curtiss Wright |
| Huntington Ingalls |
Curtiss Wright and Huntington Ingalls Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Curtiss Wright and Huntington Ingalls
The main advantage of trading using opposite Curtiss Wright and Huntington Ingalls positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Curtiss Wright position performs unexpectedly, Huntington Ingalls 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 Huntington Ingalls will offset losses from the drop in Huntington Ingalls' long position.| Curtiss Wright vs. Mercury Systems | Curtiss Wright vs. AAR Corp | Curtiss Wright vs. Ducommun Incorporated | Curtiss Wright vs. Moog Inc |
| Huntington Ingalls vs. Lockheed Martin | Huntington Ingalls vs. General Dynamics | Huntington Ingalls vs. Raytheon Technologies Corp | Huntington Ingalls vs. L3Harris Technologies |
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 the Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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