Correlation Between Lockheed Martin and Logan Ridge
Can any of the company-specific risk be diversified away by investing in both Lockheed Martin and Logan Ridge 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 Logan Ridge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lockheed Martin and Logan Ridge Finance, you can compare the effects of market volatilities on Lockheed Martin and Logan Ridge 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 Logan Ridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lockheed Martin and Logan Ridge.
Diversification Opportunities for Lockheed Martin and Logan Ridge
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lockheed and Logan is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Lockheed Martin and Logan Ridge Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Logan Ridge Finance 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 Logan Ridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Logan Ridge Finance has no effect on the direction of Lockheed Martin i.e., Lockheed Martin and Logan Ridge go up and down completely randomly.
Pair Corralation between Lockheed Martin and Logan Ridge
Considering the 90-day investment horizon Lockheed Martin is expected to under-perform the Logan Ridge. In addition to that, Lockheed Martin is 1.13 times more volatile than Logan Ridge Finance. It trades about -0.2 of its total potential returns per unit of risk. Logan Ridge Finance is currently generating about 0.19 per unit of volatility. If you would invest 2,376 in Logan Ridge Finance on August 27, 2024 and sell it today you would earn a total of 117.00 from holding Logan Ridge Finance or generate 4.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lockheed Martin vs. Logan Ridge Finance
Performance |
| Timeline |
| Lockheed Martin |
| Logan Ridge Finance |
Lockheed Martin and Logan Ridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lockheed Martin and Logan Ridge
The main advantage of trading using opposite Lockheed Martin and Logan Ridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lockheed Martin position performs unexpectedly, Logan Ridge 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 Logan Ridge will offset losses from the drop in Logan Ridge's long position.| Lockheed Martin vs. Northrop Grumman | Lockheed Martin vs. General Dynamics | Lockheed Martin vs. L3Harris Technologies | Lockheed Martin vs. The Boeing |
| Logan Ridge vs. PowerUp Acquisition Corp | Logan Ridge vs. Aurora Innovation | Logan Ridge vs. HUMANA INC | Logan Ridge vs. Aquagold International |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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