LMT vs RTX: Stock Returns, Risk & Volatility (2026)

Q: Which is a better investment: LMT or RTX?

Over the past year, RTX looks like the better investment: it had higher total return (RTX +52.2% vs LMT +49.3%) and a higher Sharpe ratio (RTX 1.54 vs LMT 1.49). On risk, LMT was less volatile (LMT 26.9% vs RTX 27.3%), LMT had a smaller max drawdown (LMT -15.6% vs RTX -16.2%), and RTX had less severe losses on the worst 5% of days (Expected Shortfall of RTX -4.09% vs LMT -4.42%).

Written by Gale Finance Team

Reviewed by Sid Kalla CFA Charterholder

Quick answer

Which is a better investment: LMT or RTX?

Over the past year, RTX outperformed (+49.3% vs +52.2%) with a Sharpe ratio of 1.54.

Total Return

LMT +49.3%

RTX WIN +52.2%

Sharpe Ratio

LMT 1.49

RTX WIN 1.54

Annualized Volatility

LMT WIN 26.9%

RTX 27.3%

Max Drawdown

LMT WIN -15.6%

RTX -16.2%

Analysis period: 2025-02-27 to 2026-02-25

LMT Total Return

↑ +49.3%

RTX Total Return

↑ +52.2%

Relative Performance of LMT vs RTX (Normalized to 100)

LMT RTX

Normalized to 100 at start date for comparison

Key Takeaways

Total Return: LMT delivered a +49.3% total return, while RTX returned +52.2% over the same period. RTX outperformed on total returns.
Risk-Adjusted Return (Sharpe Ratio): RTX had a higher Sharpe (1.54 vs 1.49), indicating better risk-adjusted performance.
Volatility (Annualized): RTX was more volatile, with 27.3% annualized volatility, versus 26.9% for LMT.
Maximum Drawdown: LMT's maximum drawdown was -15.6%, while RTX experienced a deeper drawdown of -16.2%.
Tail Risk (VaR & Expected Shortfall): At the 5% level (daily log returns), LMT's VaR was -2.58% and its Expected Shortfall (CVaR) was -4.42%; RTX's were -2.12% and -4.09%. VaR is the cutoff; Expected Shortfall is the average move on the worst days.
Skew & Kurtosis: Skew: LMT -1.57 vs RTX -1.24. Excess kurtosis: LMT 8.81 vs RTX 11.47. Negative skew leans downside; higher excess kurtosis means fatter tails.
Tail Days & Extremes: 2σ tail days (down/up): LMT 9/5, RTX 6/4. Worst day: LMT -10.81% (2025-07-22) vs RTX -9.81% (2025-04-04). Best day: LMT +4.72% (2026-01-09) vs RTX +7.67% (2025-10-21).
Risk ratios: Sortino - LMT: 2.03 vs. RTX: 2.20 , Calmar - LMT: 3.19 vs. RTX: 3.26 , Sterling - LMT: 3.45 vs. RTX: 3.00 , Treynor - LMT: 1.66 vs. RTX: 0.74 , Ulcer Index - LMT: 6.04% vs. RTX: 3.45%

Lockheed Martin vs RTX Correlation

0.41 Average Correlation

Lockheed Martin and RTX are moderately correlated over the past year. With a correlation of 0.41, these assets show moderate co-movement, offering some diversification when held together.

For portfolio construction, this moderate correlation offers some diversification benefit, though the assets still tend to move together during major market moves.

Metric	Value
Current (30-day)	0.50
Average (full period)	0.41
Minimum	-0.28
Maximum	0.73

Correlation measures how closely two assets move together. Values near +1 indicate strong co-movement, near 0 indicates independence, and negative values indicate inverse movement.

Investment Comparison

If you invested $10,000 in each asset on February 27, 2025:

LMT $14,933.23 +49.3%

RTX $15,219.82 +52.2%

Difference: $286.59 (RTX ahead)

Lockheed Martin and RTX: Risk Analysis

Lockheed Martin experienced its maximum drawdown of -15.6% from 2025-06-13 to 2025-07-22. It took 63 days to recover.

RTX experienced its maximum drawdown of -16.2% from 2025-03-25 to 2025-04-22. It took 27 days to recover.

Smaller drawdowns and faster recoveries indicate lower downside risk and greater resilience during market stress.

Sharpe Ratio of LMT and RTX

LMT Sharpe Ratio

↑ 1.49

RTX Sharpe Ratio

↑ 1.54

Sharpe ratio measures return per unit of risk (volatility). A higher Sharpe indicates better risk-adjusted performance. RTX had a higher Sharpe (1.54 vs 1.49), indicating better risk-adjusted performance.

A Sharpe above 1.0 is generally considered good, above 2.0 is excellent. Negative Sharpe means the asset underperformed the risk-free rate. Calculated on each asset's full 365-day lookback of available prices and annualized using the asset calendar (365 for crypto, 252 trading days for equities/ETFs/metals).

Sortino Ratio of LMT and RTX

LMT Sortino Ratio

↑ 2.03

RTX Sortino Ratio

↑ 2.20

Sortino ratio measures return per unit of downside risk. Unlike Sharpe, it only counts downside deviation (returns below the target return). RTX had better downside-adjusted returns.

A higher Sortino is better. It's useful when upside volatility is common (crypto is the obvious example). Downside deviation: LMT 19.8% vs RTX 19.1%. Calculated on each asset's full 365-day lookback of available prices, using the daily risk-free rate as the target return, and annualized using the asset calendar (365 for crypto, 252 trading days for equities/ETFs/metals).

Calmar Ratio of LMT and RTX

LMT Calmar Ratio

↑ 3.19

RTX Calmar Ratio

↑ 3.26

Calmar ratio compares CAGR to maximum drawdown. Higher Calmar means more return per unit of worst drawdown. RTX posted the higher Calmar ratio.

Calmar is computed on each asset's full 365-day lookback and uses the max drawdown over that same window.

Sterling Ratio of LMT and RTX

LMT Sterling Ratio

↑ 3.45

RTX Sterling Ratio

↑ 3.00

Sterling ratio measures excess return per unit of average drawdown (typically drawdowns worse than 10%). LMT posted the higher Sterling ratio.

Sterling uses average drawdown events deeper than 10% and subtracts the risk-free rate to report excess return.

Treynor Ratio of LMT and RTX

LMT Treynor Ratio

↑ 1.66

RTX Treynor Ratio

↑ 0.74

Treynor ratio measures excess return per unit of market risk (beta) instead of total volatility. LMT posted the higher Treynor ratio.

Treynor uses beta vs the S&P 500 (SPY) on shared dates and the average 3-month Treasury rate as the risk-free rate.

Ulcer Index of LMT and RTX

LMT Ulcer Index

6.04%

RTX Ulcer Index

3.45%

Ulcer Index captures drawdown depth and duration. Lower Ulcer Index means less drawdown pain. RTX had the lower Ulcer Index (less drawdown pain).

Ulcer Index is computed from each asset's drawdown series over the full lookback window.

Tail Risk & Distribution Shape (1-Year): Lockheed Martin vs. RTX

This section looks at the shape of daily returns, not just the average. Tail stats are computed per asset on its own daily series (crypto includes weekends). We use daily log returns $\ln\left(\frac{P_t}{P_{t-1}}\right)$ so multi-day moves add cleanly.

Definitions: Value at Risk (VaR), Expected Shortfall, skew, kurtosis, and fat tails.

Metric (1-Year)	LMT	RTX
5% VaR (daily log return)	-2.58%	-2.12%
5% Expected Shortfall (CVaR)	-4.42% (worst 13 days)	-4.09% (worst 13 days)
Skew	-1.57	-1.24
Excess kurtosis	8.81	11.47
2σ tail days (down / up)	9 / 5	6 / 4
Worst day	-10.81% (2025-07-22)	-9.81% (2025-04-04)
Best day	+4.72% (2026-01-09)	+7.67% (2025-10-21)

Downside co-moves (2σ) — 1-Year

Computed on shared dates only (n=249). A “2σ downside move” means a shared-close log return more than 2 standard deviations below that asset’s own mean on this shared-date series. Dates below show simple returns (%) for readability.

When RTX has a big down day, LMT also does

50.0%

3 / 6 days

When LMT has a big down day, RTX also does

33.3%

3 / 9 days

Show downside tail dates

Dates below are shared-date observations. The “Date” is the period end (close). Tail thresholds are computed on log returns, but the table shows simple returns (%) for readability. Returns are computed from the previous shared close to this one (for example, Friday → Monday includes weekend moves).

Days when both LMT and RTX had a big down day (2σ)

Date (interval)	LMT	RTX
2025-04-04	-4.98%	-9.81%
2025-11-28 → 2025-12-01	-3.32%	-3.94%
2026-02-04	-4.06%	-3.32%

Days when LMT had a big down day

Date (interval)	LMT	RTX
2025-03-21	-5.79%	-1.56%
2025-04-04	-4.98%	-9.81%
2025-06-11	-4.26%	+2.38%
2025-06-13 → 2025-06-16	-3.99%	+0.53%
2025-07-22	-10.81%	-1.58%
2025-10-21	-3.24%	+7.67%
2025-11-28 → 2025-12-01	-3.32%	-3.94%
2026-01-07	-4.82%	-2.45%
2026-02-04	-4.06%	-3.32%

Days when RTX had a big down day

Date (interval)	LMT	RTX
2025-03-04	-0.69%	-3.83%
2025-04-04	-4.98%	-9.81%
2025-04-22	+0.82%	-9.81%
2025-10-09	-1.22%	-3.79%
2025-11-28 → 2025-12-01	-3.32%	-3.94%
2026-02-04	-4.06%	-3.32%

Read this as “how ugly the ugly days get”, not as a precise forecast. One-year samples are small, so tail estimates are inherently noisy.

Lockheed Martin vs RTX Volatility (LMT vs RTX)

LMT Volatility

26.9%

±1.7% daily

RTX Volatility

27.3%

±1.72% daily

Typical daily swing

LMT

±1.7%

RTX

±1.72%

Lockheed Martin's annualized volatility of 26.9% means it typically moves ±1.7% on any given day.

RTX's annualized volatility of 27.3% means it typically moves ±1.72% on any given day.

RTX's higher volatility means a wider path to returns — this can be attractive for tactical, shorter-term exposure, while LMT's smoother profile may better suit long-term allocators seeking steadier growth.

For comparison, the S&P 500 typically has 15-18% annualized volatility, translating to roughly ±1% daily moves. Higher volatility means larger potential gains but also larger potential losses.

Lockheed Martin vs RTX Performance Over Time

Metric	LMT	RTX
30 Days	11.3%	1%
90 Days	43.7%	13.2%
180 Days	44.3%	24.1%
1 Year	49.3%	52.2%

Shorter time frames can show different leaders as market conditions change. Consider your investment horizon when comparing performance.

Full Comparison of Lockheed Martin vs. RTX (1-Year)

Metric	LMT	RTX
Total Return	+49.3%	+52.2%
Annualized Volatility	26.9%	27.3%
Sharpe Ratio	1.49	1.54
Sortino Ratio	2.03	2.20
Calmar Ratio	3.19	3.26
Sterling Ratio	3.45	3.00
Treynor Ratio	1.66	0.74
Ulcer Index	6.04%	3.45%
Max Drawdown	-15.6%	-16.2%
Avg Correlation to S&P 500	0.10	0.29
5% VaR (daily log return)	-2.58%	-2.12%
5% Expected Shortfall (CVaR)	-4.42%	-4.09%
Skew	-1.57	-1.24
Excess kurtosis	8.81	11.47
2σ tail days (down / up)	9 / 5	6 / 4

Audit this calculation

Formulas, inputs, and conventions used to compute the metrics on this page.

Inputs & conventions

Shared window for pair metrics: 2025-02-27 → 2026-02-25 (last shared close).
Rolling correlation sample (shared closes): 220 rolling 30-day values (from 249 shared daily returns).
Annualization (days/year): LMT: 252 days/year; RTX: 252 days/year.
Risk-free rate: Uses the 3-month U.S. Treasury yield (FRED: DGS3MO), averaged over each asset’s window:

LMT: 4.20% over 2025-02-27 → 2026-02-25.

RTX: 4.20% over 2025-02-27 → 2026-02-25.
Volatility drag (rule of thumb): Estimated from annualized volatility (simple returns). For the log-return framing, see Log returns.

LMT: ≈ -3.6%/yr

RTX: ≈ -3.7%/yr
Data alignment: No forward fill. Correlation and tail co-moves are computed on shared closes only.
For cross-calendar pairs (e.g., crypto vs stocks), weekend/holiday moves roll into the next shared close.
Return conventions: Volatility/Sharpe/Sortino use simple daily returns. Tail-risk uses daily log returns for distribution stats (but tables show simple returns). Log returns.

Formulas

Daily simple return

r_t = \frac{P_t}{P_{t-1}} - 1

Volatility

\sigma_{ann} = \sigma(r_t)\sqrt{A}

Volatility drag (approx.)

\text{drag} \approx \tfrac{1}{2}\sigma_{ann}^2

Sharpe Ratio

S = \frac{A\,\bar{r} - r_f}{\sigma(r_t)\sqrt{A}}

Sortino Ratio

So = \frac{A\,\bar{r} - r_f}{\sqrt{\mathbb{E}[\min(0,\,r_t - r_f/A)^2]}\,\sqrt{A}}

Maximum Drawdown

MDD = \min_t\left(\frac{P_t}{\max_{s \le t} P_s} - 1\right)

Average Correlation

\rho = \frac{\operatorname{cov}(r^A,\,r^B)}{\sigma_A\,\sigma_B}

Log returns

\ell_t = \ln\left(\frac{P_t}{P_{t-1}}\right)

Notation

$P_t$: Price on day t.
$r_t$: Simple daily return.
$\ell_t$: Log daily return.
$\bar{r}$: Average daily return.
$\sigma(r_t)$: Standard deviation of daily returns.
$A$: Annualization factor (days/year).
$r_f$: Annual risk-free rate.

Lockheed Martin vs RTX: Frequently Asked Questions

Which has higher volatility: LMT or RTX?

RTX showed higher volatility at 27.3% annualized, compared to 26.9% for LMT Over the past year. Higher volatility means larger price swings in both directions.

Does LMT provide diversification when held with RTX?

LMT and RTX are moderately correlated over the past year, with an average correlation of 0.41. This offers some diversification benefit, though they still tend to move together during major market moves.

How bad are the worst 5% days for LMT vs RTX?

Over the past year, LMT's 5% VaR was -2.58% and its 5% Expected Shortfall was -4.42% (worst 13 days). RTX's were -2.12% and -4.09% (worst 13 days).

Do LMT and RTX crash together on bad days?

On shared dates (n=249), when RTX has a 2σ down day, LMT also does 50.0% (3/6 days). In the other direction, when LMT has one, RTX also does 33.3% (3/9 days).

Which has better risk-adjusted returns: LMT or RTX?

RTX showed better risk-adjusted performance with a Sharpe ratio of 1.54 versus LMT's 1.49 Over the past year.

Can LMT and RTX be combined in a portfolio?

Yes, though allocation sizing matters. Their moderate correlation offers some diversification benefits. RTX's higher volatility (27.3%) means even small allocations can materially impact overall portfolio risk.