RTX: factor decomposition (Defense)

How much of RTX's move over the window is systematic (market, XLI sector-excess, rate-excess via TLT) vs. idiosyncratic (stock-specific).

Return decomposition (log-return points, additive)

Market+7.50ppSector (excess)+13.70ppRate (excess)-0.26ppIdiosyncratic-0.68pp

Factor betas

Beta · Market (SPY)+0.37
Beta · Sector-excess (XLI)+1.06
Beta · Rate-excess (TLT)+0.07
R²0.28
Window2025-08-22 → 2026-09-24 (273 trading days)

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Moderate confidence: R² is 0.28; these three factors explain some but not most of RTX's day-to-day variance. Treat the split below as directional.

Of RTX's +20.3pp move over this window, -0.7pp (3% of the total magnitude) is idiosyncratic, not explained by riding market, sector, or rate moves. The rest (+20.9pp) came from systematic exposure: market +7.5pp, sector +13.7pp, rate -0.3pp.

Generated 2026-09-25 07:03 UTC · factor-decomposition · simple 3-factor OLS (market, sector-excess, rate-excess, mutually orthogonalized) · log returns, additive over the window · a transparent estimate, not a commercial risk model: treat betas as directional, always check R² first.