Correlation Between Triumph and L3Harris Technologies
Can any of the company-specific risk be diversified away by investing in both Triumph and L3Harris Technologies 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 Triumph and L3Harris Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triumph Group and L3Harris Technologies, you can compare the effects of market volatilities on Triumph and L3Harris Technologies 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 Triumph with a short position of L3Harris Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triumph and L3Harris Technologies.
Diversification Opportunities for Triumph and L3Harris Technologies
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Triumph and L3Harris is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Triumph Group and L3Harris Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on L3Harris Technologies and Triumph 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 Triumph Group are associated (or correlated) with L3Harris Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of L3Harris Technologies has no effect on the direction of Triumph i.e., Triumph and L3Harris Technologies go up and down completely randomly.
Pair Corralation between Triumph and L3Harris Technologies
If you would invest 24,426 in L3Harris Technologies on August 31, 2024 and sell it today you would earn a total of 107.00 from holding L3Harris Technologies or generate 0.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Triumph Group vs. L3Harris Technologies
Performance |
| Timeline |
| Triumph Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| L3Harris Technologies |
Triumph and L3Harris Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triumph and L3Harris Technologies
The main advantage of trading using opposite Triumph and L3Harris Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triumph position performs unexpectedly, L3Harris Technologies 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 L3Harris Technologies will offset losses from the drop in L3Harris Technologies' long position.| Triumph vs. Addus HomeCare | Triumph vs. SunLink Health Systems | Triumph vs. Sonida Senior Living | Triumph vs. Boston Properties |
| L3Harris Technologies vs. Lockheed Martin | L3Harris Technologies vs. General Dynamics | L3Harris Technologies vs. Raytheon Technologies Corp | L3Harris Technologies vs. Huntington Ingalls Industries |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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