Correlation Between Lockheed Martin and Angel Oak
Can any of the company-specific risk be diversified away by investing in both Lockheed Martin and Angel Oak 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 Angel Oak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lockheed Martin and Angel Oak Ultrashort, you can compare the effects of market volatilities on Lockheed Martin and Angel Oak 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 Angel Oak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lockheed Martin and Angel Oak.
Diversification Opportunities for Lockheed Martin and Angel Oak
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lockheed and Angel is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Lockheed Martin and Angel Oak Ultrashort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Angel Oak Ultrashort 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 Angel Oak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Angel Oak Ultrashort has no effect on the direction of Lockheed Martin i.e., Lockheed Martin and Angel Oak go up and down completely randomly.
Pair Corralation between Lockheed Martin and Angel Oak
Considering the 90-day investment horizon Lockheed Martin is expected to generate 20.78 times more return on investment than Angel Oak. However, Lockheed Martin is 20.78 times more volatile than Angel Oak Ultrashort. It trades about 0.13 of its potential returns per unit of risk. Angel Oak Ultrashort is currently generating about 0.43 per unit of risk. If you would invest 45,288 in Lockheed Martin on August 26, 2024 and sell it today you would earn a total of 8,934 from holding Lockheed Martin or generate 19.73% 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. Angel Oak Ultrashort
Performance |
| Timeline |
| Lockheed Martin |
| Angel Oak Ultrashort |
Lockheed Martin and Angel Oak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lockheed Martin and Angel Oak
The main advantage of trading using opposite Lockheed Martin and Angel Oak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lockheed Martin position performs unexpectedly, Angel Oak 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 Angel Oak will offset losses from the drop in Angel Oak's long position.| Lockheed Martin vs. Northrop Grumman | Lockheed Martin vs. General Dynamics | Lockheed Martin vs. L3Harris Technologies | Lockheed Martin vs. The Boeing |
| Angel Oak vs. First Trust Low | Angel Oak vs. First Trust Senior | Angel Oak vs. First Trust TCW | Angel Oak vs. First Trust Tactical |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |