Correlation Between Virgin Orbit and Lockheed Martin

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

By analyzing existing cross correlation between Virgin Orbit Holdings and Lockheed Martin, you can compare the effects of market volatilities on Virgin Orbit and Lockheed Martin 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 Virgin Orbit with a short position of Lockheed Martin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virgin Orbit and Lockheed Martin.

Diversification Opportunities for Virgin Orbit and Lockheed Martin

0.0

Correlation Coefficient

Virgin Orbit  Lockheed Martin

Pay attention - limited upside

The 3 months correlation between Virgin and Lockheed is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Virgin Orbit Holdings and Lockheed Martin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lockheed Martin and Virgin Orbit 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 Virgin Orbit Holdings are associated (or correlated) with Lockheed Martin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lockheed Martin has no effect on the direction of Virgin Orbit i.e., Virgin Orbit and Lockheed Martin go up and down completely randomly.

Pair Corralation between Virgin Orbit and Lockheed Martin

If you would invest  41,633  in Lockheed Martin on July 23, 2025 and sell it today you would earn a total of  8,957  from holding Lockheed Martin or generate 21.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Virgin Orbit Holdings  vs.  Lockheed Martin

Virgin Orbit Holdings

Risk-Adjusted Performance

Weakest

Over the last 90 days Virgin Orbit Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental drivers, Virgin Orbit is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Lockheed Martin

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Lockheed Martin are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady primary indicators, Lockheed Martin unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Virgin Orbit and Lockheed Martin

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

The idea behind Virgin Orbit Holdings and Lockheed Martin 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.