Correlation Between Lockheed Martin and Mutual Of
Can any of the company-specific risk be diversified away by investing in both Lockheed Martin and Mutual Of 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 Mutual Of into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lockheed Martin and Mutual Of America, you can compare the effects of market volatilities on Lockheed Martin and Mutual Of 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 Mutual Of. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lockheed Martin and Mutual Of.
Diversification Opportunities for Lockheed Martin and Mutual Of
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lockheed and Mutual is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Lockheed Martin and Mutual Of America in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mutual Of America 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 Mutual Of. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mutual Of America has no effect on the direction of Lockheed Martin i.e., Lockheed Martin and Mutual Of go up and down completely randomly.
Pair Corralation between Lockheed Martin and Mutual Of
Considering the 90-day investment horizon Lockheed Martin is expected to under-perform the Mutual Of. In addition to that, Lockheed Martin is 5.42 times more volatile than Mutual Of America. It trades about -0.29 of its total potential returns per unit of risk. Mutual Of America is currently generating about 0.2 per unit of volatility. If you would invest 1,355 in Mutual Of America on November 18, 2024 and sell it today you would earn a total of 25.00 from holding Mutual Of America or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lockheed Martin vs. Mutual Of America
Performance |
| Timeline |
| Lockheed Martin |
| Mutual Of America |
Lockheed Martin and Mutual Of Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lockheed Martin and Mutual Of
The main advantage of trading using opposite Lockheed Martin and Mutual Of positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lockheed Martin position performs unexpectedly, Mutual Of 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 Mutual Of will offset losses from the drop in Mutual Of's long position.| Lockheed Martin vs. Northrop Grumman | Lockheed Martin vs. General Dynamics | Lockheed Martin vs. L3Harris Technologies | Lockheed Martin vs. The Boeing |
| Mutual Of vs. Calvert Short Duration | Mutual Of vs. Riverpark Short Term | Mutual Of vs. Federated Government Ultrashort | Mutual Of vs. Fidelity Flex Servative |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |