Correlation Between Lockheed Martin and Quad Graphics
Can any of the company-specific risk be diversified away by investing in both Lockheed Martin and Quad Graphics 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 Quad Graphics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lockheed Martin and Quad Graphics, you can compare the effects of market volatilities on Lockheed Martin and Quad Graphics 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 Quad Graphics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lockheed Martin and Quad Graphics.
Diversification Opportunities for Lockheed Martin and Quad Graphics
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lockheed and Quad is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Lockheed Martin and Quad Graphics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quad Graphics 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 Quad Graphics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quad Graphics has no effect on the direction of Lockheed Martin i.e., Lockheed Martin and Quad Graphics go up and down completely randomly.
Pair Corralation between Lockheed Martin and Quad Graphics
Considering the 90-day investment horizon Lockheed Martin is expected to generate 0.21 times more return on investment than Quad Graphics. However, Lockheed Martin is 4.68 times less risky than Quad Graphics. It trades about 0.01 of its potential returns per unit of risk. Quad Graphics is currently generating about -0.03 per unit of risk. If you would invest 45,542 in Lockheed Martin on January 20, 2024 and sell it today you would earn a total of 67.00 from holding Lockheed Martin or generate 0.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Lockheed Martin vs. Quad Graphics
Performance |
| Timeline |
| Lockheed Martin |
| Quad Graphics |
Lockheed Martin and Quad Graphics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lockheed Martin and Quad Graphics
The main advantage of trading using opposite Lockheed Martin and Quad Graphics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lockheed Martin position performs unexpectedly, Quad Graphics 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 Quad Graphics will offset losses from the drop in Quad Graphics' long position.| Lockheed Martin vs. Novocure | Lockheed Martin vs. HubSpot | Lockheed Martin vs. DigitalOcean Holdings | Lockheed Martin vs. Appian Corp |
| Quad Graphics vs. Avalon Holdings | Quad Graphics vs. LanzaTech Global | Quad Graphics vs. Ambipar Emergency Response | Quad Graphics vs. Houston Natural Resources |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| 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 | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Stocks Directory Find actively traded stocks across global markets | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |