Correlation Between Nauticus Robotics and L3Harris Technologies
Can any of the company-specific risk be diversified away by investing in both Nauticus Robotics and L3Harris Technologies 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 Nauticus Robotics and L3Harris Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nauticus Robotics and L3Harris Technologies, you can compare the effects of market volatilities on Nauticus Robotics and L3Harris Technologies 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 Nauticus Robotics with a short position of L3Harris Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nauticus Robotics and L3Harris Technologies.
Diversification Opportunities for Nauticus Robotics and L3Harris Technologies
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nauticus and L3Harris is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Nauticus Robotics and L3Harris Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on L3Harris Technologies and Nauticus Robotics 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 Nauticus Robotics are associated (or correlated) with L3Harris Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of L3Harris Technologies has no effect on the direction of Nauticus Robotics i.e., Nauticus Robotics and L3Harris Technologies go up and down completely randomly.
Pair Corralation between Nauticus Robotics and L3Harris Technologies
Assuming the 90 days horizon Nauticus Robotics is expected to under-perform the L3Harris Technologies. In addition to that, Nauticus Robotics is 4.2 times more volatile than L3Harris Technologies. It trades about -0.09 of its total potential returns per unit of risk. L3Harris Technologies is currently generating about 0.03 per unit of volatility. If you would invest 24,467 in L3Harris Technologies on August 24, 2024 and sell it today you would earn a total of 193.00 from holding L3Harris Technologies or generate 0.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nauticus Robotics vs. L3Harris Technologies
Performance |
| Timeline |
| Nauticus Robotics |
| L3Harris Technologies |
Nauticus Robotics and L3Harris Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nauticus Robotics and L3Harris Technologies
The main advantage of trading using opposite Nauticus Robotics and L3Harris Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nauticus Robotics position performs unexpectedly, L3Harris Technologies 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 L3Harris Technologies will offset losses from the drop in L3Harris Technologies' long position.| Nauticus Robotics vs. Chardan NexTech Acquisition | Nauticus Robotics vs. Arbe Robotics Ltd | Nauticus Robotics vs. Gorilla Technology Group |
| L3Harris Technologies vs. Lockheed Martin | L3Harris Technologies vs. General Dynamics | L3Harris Technologies vs. Raytheon Technologies Corp | L3Harris Technologies vs. Huntington Ingalls Industries |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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