Correlation Between Lockheed Martin and Oberbank
Can any of the company-specific risk be diversified away by investing in both Lockheed Martin and Oberbank 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 Oberbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lockheed Martin and Oberbank AG, you can compare the effects of market volatilities on Lockheed Martin and Oberbank 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 Oberbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lockheed Martin and Oberbank.
Diversification Opportunities for Lockheed Martin and Oberbank
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lockheed and Oberbank is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Lockheed Martin and Oberbank AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oberbank AG 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 Oberbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oberbank AG has no effect on the direction of Lockheed Martin i.e., Lockheed Martin and Oberbank go up and down completely randomly.
Pair Corralation between Lockheed Martin and Oberbank
Considering the 90-day investment horizon Lockheed Martin is expected to under-perform the Oberbank. In addition to that, Lockheed Martin is 9.4 times more volatile than Oberbank AG. It trades about -0.09 of its total potential returns per unit of risk. Oberbank AG is currently generating about 0.22 per unit of volatility. If you would invest 7,020 in Oberbank AG on August 27, 2024 and sell it today you would earn a total of 40.00 from holding Oberbank AG or generate 0.57% 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. Oberbank AG
Performance |
| Timeline |
| Lockheed Martin |
| Oberbank AG |
Lockheed Martin and Oberbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lockheed Martin and Oberbank
The main advantage of trading using opposite Lockheed Martin and Oberbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lockheed Martin position performs unexpectedly, Oberbank 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 Oberbank will offset losses from the drop in Oberbank's long position.| Lockheed Martin vs. Northrop Grumman | Lockheed Martin vs. General Dynamics | Lockheed Martin vs. L3Harris Technologies | Lockheed Martin vs. The Boeing |
| Oberbank vs. UNIQA Insurance Group | Oberbank vs. BKS Bank AG | Oberbank vs. Vienna Insurance Group | Oberbank vs. Addiko Bank AG |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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