Correlation Between Momentus and Boeing
Can any of the company-specific risk be diversified away by investing in both Momentus and Boeing 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 Momentus and Boeing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Momentus and The Boeing, you can compare the effects of market volatilities on Momentus and Boeing 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 Momentus with a short position of Boeing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Momentus and Boeing.
Diversification Opportunities for Momentus and Boeing
Very good diversification
The 3 months correlation between Momentus and Boeing is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Momentus and The Boeing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boeing and Momentus 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 Momentus are associated (or correlated) with Boeing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boeing has no effect on the direction of Momentus i.e., Momentus and Boeing go up and down completely randomly.
Pair Corralation between Momentus and Boeing
Given the investment horizon of 90 days Momentus is expected to under-perform the Boeing. In addition to that, Momentus is 5.11 times more volatile than The Boeing. It trades about -0.2 of its total potential returns per unit of risk. The Boeing is currently generating about 0.15 per unit of volatility. If you would invest 17,187 in The Boeing on November 2, 2024 and sell it today you would earn a total of 766.00 from holding The Boeing or generate 4.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Momentus vs. The Boeing
Performance |
| Timeline |
| Momentus |
| Boeing |
Momentus and Boeing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Momentus and Boeing
The main advantage of trading using opposite Momentus and Boeing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Momentus position performs unexpectedly, Boeing 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 Boeing will offset losses from the drop in Boeing's long position.| Momentus vs. Planet Labs PBC | Momentus vs. Rocket Lab USA | Momentus vs. Redwire Corp | Momentus vs. Virgin Galactic Holdings |
| Boeing vs. Sidus Space | Boeing vs. Planet Labs PBC | Boeing vs. Intuitive Machines | Boeing vs. Rocket Lab USA |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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