Correlation Between L3Harris Technologies, and Cruzeiro

Can any of the company-specific risk be diversified away by investing in both L3Harris Technologies, and Cruzeiro 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 L3Harris Technologies, and Cruzeiro into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between L3Harris Technologies, and Cruzeiro do Sul, you can compare the effects of market volatilities on L3Harris Technologies, and Cruzeiro 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 L3Harris Technologies, with a short position of Cruzeiro. Check out your portfolio center. Please also check ongoing floating volatility patterns of L3Harris Technologies, and Cruzeiro.

Diversification Opportunities for L3Harris Technologies, and Cruzeiro

0.7

Correlation Coefficient

L3Harris Technologies,  Cruzeiro

Poor diversification

The 3 months correlation between L3Harris and Cruzeiro is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding L3Harris Technologies, and Cruzeiro do Sul in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cruzeiro do Sul and L3Harris 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 L3Harris Technologies, are associated (or correlated) with Cruzeiro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cruzeiro do Sul has no effect on the direction of L3Harris Technologies, i.e., L3Harris Technologies, and Cruzeiro go up and down completely randomly.

Pair Corralation between L3Harris Technologies, and Cruzeiro

Assuming the 90 days trading horizon L3Harris Technologies, is expected to generate 0.43 times more return on investment than Cruzeiro. However, L3Harris Technologies, is 2.33 times less risky than Cruzeiro. It trades about 0.08 of its potential returns per unit of risk. Cruzeiro do Sul is currently generating about 0.03 per unit of risk. If you would invest  22,079  in L3Harris Technologies, on April 20, 2025 and sell it today you would earn a total of  14,144  from holding L3Harris Technologies, or generate 64.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.8%
Values	Daily Returns

L3Harris Technologies,  vs.  Cruzeiro do Sul

L3Harris Technologies,

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in L3Harris Technologies, are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain technical indicators, L3Harris Technologies, may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Cruzeiro do Sul

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cruzeiro do Sul are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Cruzeiro unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with L3Harris Technologies, and Cruzeiro

The main advantage of trading using opposite L3Harris Technologies, and Cruzeiro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if L3Harris Technologies, position performs unexpectedly, Cruzeiro 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 Cruzeiro will offset losses from the drop in Cruzeiro's long position.

The idea behind L3Harris Technologies, and Cruzeiro do Sul pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.