Correlation Between Lockheed Martin and Virtus ETF
Can any of the company-specific risk be diversified away by investing in both Lockheed Martin and Virtus ETF 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 Virtus ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lockheed Martin and Virtus ETF Trust, you can compare the effects of market volatilities on Lockheed Martin and Virtus ETF 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 Virtus ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lockheed Martin and Virtus ETF.
Diversification Opportunities for Lockheed Martin and Virtus ETF
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lockheed and Virtus is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Lockheed Martin and Virtus ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus ETF Trust 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 Virtus ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus ETF Trust has no effect on the direction of Lockheed Martin i.e., Lockheed Martin and Virtus ETF go up and down completely randomly.
Pair Corralation between Lockheed Martin and Virtus ETF
Considering the 90-day investment horizon Lockheed Martin is expected to under-perform the Virtus ETF. In addition to that, Lockheed Martin is 39.03 times more volatile than Virtus ETF Trust. It trades about -0.29 of its total potential returns per unit of risk. Virtus ETF Trust is currently generating about 0.3 per unit of volatility. If you would invest 2,391 in Virtus ETF Trust on November 18, 2024 and sell it today you would earn a total of 9.00 from holding Virtus ETF Trust or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lockheed Martin vs. Virtus ETF Trust
Performance |
| Timeline |
| Lockheed Martin |
| Virtus ETF Trust |
Lockheed Martin and Virtus ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lockheed Martin and Virtus ETF
The main advantage of trading using opposite Lockheed Martin and Virtus ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lockheed Martin position performs unexpectedly, Virtus ETF 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 Virtus ETF will offset losses from the drop in Virtus ETF's long position.| Lockheed Martin vs. Northrop Grumman | Lockheed Martin vs. General Dynamics | Lockheed Martin vs. L3Harris Technologies | Lockheed Martin vs. The Boeing |
| Virtus ETF vs. Franklin Liberty Senior | Virtus ETF vs. Virtus Newfleet Multi Sector | Virtus ETF vs. Pacer Pacific Asset | Virtus ETF vs. JPMorgan USD Emerging |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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