Correlation Between Redwire Corp and Moog

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

By analyzing existing cross correlation between Redwire Corp and Moog Inc, you can compare the effects of market volatilities on Redwire Corp and Moog 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 Redwire Corp with a short position of Moog. Check out your portfolio center. Please also check ongoing floating volatility patterns of Redwire Corp and Moog.

Diversification Opportunities for Redwire Corp and Moog

0.38

Correlation Coefficient

Redwire Corp  Moog

Weak diversification

The 3 months correlation between Redwire and Moog is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Redwire Corp and Moog Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moog Inc and Redwire Corp 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 Redwire Corp are associated (or correlated) with Moog. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moog Inc has no effect on the direction of Redwire Corp i.e., Redwire Corp and Moog go up and down completely randomly.

Pair Corralation between Redwire Corp and Moog

Considering the 90-day investment horizon Redwire Corp is expected to under-perform the Moog. In addition to that, Redwire Corp is 4.09 times more volatile than Moog Inc. It trades about -0.06 of its total potential returns per unit of risk. Moog Inc is currently generating about -0.07 per unit of volatility. If you would invest  19,546  in Moog Inc on December 28, 2024 and sell it today you would lose (2,046) from holding Moog Inc or give up 10.47% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Redwire Corp  vs.  Moog Inc

Redwire Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Redwire Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Moog Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Moog Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Redwire Corp and Moog

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

The idea behind Redwire Corp and Moog Inc 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.

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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.