Follow-Up on the Lockheed/General Dynamic Trade

As of 12:20pm today, Lockheed was at $74.95 and GD at $67.05. The P&L on the pair trade since we initiated it on October 28 is:

• Gain on LMT = 74.95 - 68.32 = $6.63/share

• Loss on the short GD position = 67.05 - 64.30 = $2.75/share

The slope of th regression was 0.869, implying being long 0.869 LMT share for each GD share being shorted. Profit is thus 0.869*6.63 - 2.75 = $3.01 per GD share shorted.