Correlation Between Lockheed Martin and Huntington Bancshares
Can any of the company-specific risk be diversified away by investing in both Lockheed Martin and Huntington Bancshares 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 Lockheed Martin and Huntington Bancshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lockheed Martin and Huntington Bancshares Incorporated, you can compare the effects of market volatilities on Lockheed Martin and Huntington Bancshares 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 Lockheed Martin with a short position of Huntington Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lockheed Martin and Huntington Bancshares.
Diversification Opportunities for Lockheed Martin and Huntington Bancshares
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lockheed and Huntington is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Lockheed Martin and Huntington Bancshares Incorpor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huntington Bancshares and Lockheed Martin 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 Lockheed Martin are associated (or correlated) with Huntington Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huntington Bancshares has no effect on the direction of Lockheed Martin i.e., Lockheed Martin and Huntington Bancshares go up and down completely randomly.
Pair Corralation between Lockheed Martin and Huntington Bancshares
Considering the 90-day investment horizon Lockheed Martin is expected to generate 1.47 times less return on investment than Huntington Bancshares. But when comparing it to its historical volatility, Lockheed Martin is 1.68 times less risky than Huntington Bancshares. It trades about 0.13 of its potential returns per unit of risk. Huntington Bancshares Incorporated is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,259 in Huntington Bancshares Incorporated on August 27, 2024 and sell it today you would earn a total of 530.00 from holding Huntington Bancshares Incorporated or generate 42.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lockheed Martin vs. Huntington Bancshares Incorpor
Performance |
| Timeline |
| Lockheed Martin |
| Huntington Bancshares |
Lockheed Martin and Huntington Bancshares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lockheed Martin and Huntington Bancshares
The main advantage of trading using opposite Lockheed Martin and Huntington Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lockheed Martin position performs unexpectedly, Huntington Bancshares 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 Bancshares will offset losses from the drop in Huntington Bancshares' long position.| Lockheed Martin vs. Northrop Grumman | Lockheed Martin vs. General Dynamics | Lockheed Martin vs. L3Harris Technologies | Lockheed Martin vs. The Boeing |
| Huntington Bancshares vs. Zions Bancorporation | Huntington Bancshares vs. Comerica | Huntington Bancshares vs. Western Alliance Bancorporation | Huntington Bancshares vs. US Bancorp |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |