Correlation Between Lilium NV and Huntington Ingalls
Can any of the company-specific risk be diversified away by investing in both Lilium NV 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 Lilium NV and Huntington Ingalls into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lilium NV and Huntington Ingalls Industries, you can compare the effects of market volatilities on Lilium NV 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 Lilium NV with a short position of Huntington Ingalls. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lilium NV and Huntington Ingalls.
Diversification Opportunities for Lilium NV and Huntington Ingalls
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Lilium and Huntington is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Lilium NV and Huntington Ingalls Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huntington Ingalls and Lilium NV 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 Lilium NV 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 Lilium NV i.e., Lilium NV and Huntington Ingalls go up and down completely randomly.
Pair Corralation between Lilium NV and Huntington Ingalls
Given the investment horizon of 90 days Lilium NV is expected to generate 8.09 times more return on investment than Huntington Ingalls. However, Lilium NV is 8.09 times more volatile than Huntington Ingalls Industries. It trades about 0.04 of its potential returns per unit of risk. Huntington Ingalls Industries is currently generating about -0.01 per unit of risk. If you would invest 101.00 in Lilium NV on November 19, 2024 and sell it today you would lose (80.00) from holding Lilium NV or give up 79.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lilium NV vs. Huntington Ingalls Industries
Performance |
| Timeline |
| Lilium NV |
| Huntington Ingalls |
Lilium NV and Huntington Ingalls Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lilium NV and Huntington Ingalls
The main advantage of trading using opposite Lilium NV and Huntington Ingalls positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lilium NV 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.| Lilium NV vs. Vertical Aerospace | Lilium NV vs. Ehang Holdings | Lilium NV vs. Rocket Lab USA | Lilium NV vs. Archer Aviation |
| 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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