Correlation Between SIFCO Industries and Huntington Ingalls
Can any of the company-specific risk be diversified away by investing in both SIFCO Industries and Huntington Ingalls 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 SIFCO Industries and Huntington Ingalls into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIFCO Industries and Huntington Ingalls Industries, you can compare the effects of market volatilities on SIFCO Industries and Huntington Ingalls 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 SIFCO Industries with a short position of Huntington Ingalls. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIFCO Industries and Huntington Ingalls.
Diversification Opportunities for SIFCO Industries and Huntington Ingalls
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SIFCO and Huntington is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding SIFCO Industries and Huntington Ingalls Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huntington Ingalls and SIFCO Industries 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 SIFCO Industries are associated (or correlated) with Huntington Ingalls. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huntington Ingalls has no effect on the direction of SIFCO Industries i.e., SIFCO Industries and Huntington Ingalls go up and down completely randomly.
Pair Corralation between SIFCO Industries and Huntington Ingalls
Considering the 90-day investment horizon SIFCO Industries is expected to generate 3.04 times more return on investment than Huntington Ingalls. However, SIFCO Industries is 3.04 times more volatile than Huntington Ingalls Industries. It trades about 0.24 of its potential returns per unit of risk. Huntington Ingalls Industries is currently generating about 0.12 per unit of risk. If you would invest 502.00 in SIFCO Industries on May 29, 2025 and sell it today you would earn a total of 171.00 from holding SIFCO Industries or generate 34.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIFCO Industries vs. Huntington Ingalls Industries
Performance |
| Timeline |
| SIFCO Industries |
| Huntington Ingalls |
SIFCO Industries and Huntington Ingalls Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIFCO Industries and Huntington Ingalls
The main advantage of trading using opposite SIFCO Industries and Huntington Ingalls positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIFCO Industries position performs unexpectedly, Huntington Ingalls 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 Huntington Ingalls will offset losses from the drop in Huntington Ingalls' long position.| SIFCO Industries vs. Air Industries Group | SIFCO Industries vs. Ballistic Recovery Systems | SIFCO Industries vs. CPI Aerostructures | SIFCO Industries vs. Ducommun Incorporated |
| Huntington Ingalls vs. Lockheed Martin | Huntington Ingalls vs. General Dynamics | Huntington Ingalls vs. Raytheon Technologies Corp | Huntington Ingalls vs. L3Harris Technologies |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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