Correlation Between Raytheon Technologies and Spirit Aerosystems
Can any of the company-specific risk be diversified away by investing in both Raytheon Technologies and Spirit Aerosystems 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 Raytheon Technologies and Spirit Aerosystems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raytheon Technologies Corp and Spirit Aerosystems Holdings, you can compare the effects of market volatilities on Raytheon Technologies and Spirit Aerosystems 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 Raytheon Technologies with a short position of Spirit Aerosystems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raytheon Technologies and Spirit Aerosystems.
Diversification Opportunities for Raytheon Technologies and Spirit Aerosystems
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Raytheon and Spirit is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Raytheon Technologies Corp and Spirit Aerosystems Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spirit Aerosystems and Raytheon Technologies 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 Raytheon Technologies Corp are associated (or correlated) with Spirit Aerosystems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spirit Aerosystems has no effect on the direction of Raytheon Technologies i.e., Raytheon Technologies and Spirit Aerosystems go up and down completely randomly.
Pair Corralation between Raytheon Technologies and Spirit Aerosystems
Considering the 90-day investment horizon Raytheon Technologies Corp is expected to generate 1.04 times more return on investment than Spirit Aerosystems. However, Raytheon Technologies is 1.04 times more volatile than Spirit Aerosystems Holdings. It trades about 0.12 of its potential returns per unit of risk. Spirit Aerosystems Holdings is currently generating about -0.13 per unit of risk. If you would invest 15,739 in Raytheon Technologies Corp on August 31, 2025 and sell it today you would earn a total of 1,752 from holding Raytheon Technologies Corp or generate 11.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Raytheon Technologies Corp vs. Spirit Aerosystems Holdings
Performance |
| Timeline |
| Raytheon Technologies |
| Spirit Aerosystems |
Raytheon Technologies and Spirit Aerosystems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raytheon Technologies and Spirit Aerosystems
The main advantage of trading using opposite Raytheon Technologies and Spirit Aerosystems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raytheon Technologies position performs unexpectedly, Spirit Aerosystems 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 Spirit Aerosystems will offset losses from the drop in Spirit Aerosystems' long position.| Raytheon Technologies vs. Cleantech Power Corp | Raytheon Technologies vs. CVW CleanTech | Raytheon Technologies vs. Ecoloclean Industrs | Raytheon Technologies vs. Hutchison Telecommunications Hong |
| Spirit Aerosystems vs. ABN AMRO Bank | Spirit Aerosystems vs. Aldel Financial II | Spirit Aerosystems vs. The Hanover Insurance | Spirit Aerosystems vs. iA Financial |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| AI Portfolio Prophet Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |