Correlation Between Postal Savings and INTUITIVE SURGICAL
Can any of the company-specific risk be diversified away by investing in both Postal Savings and INTUITIVE SURGICAL 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 Postal Savings and INTUITIVE SURGICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postal Savings Bank and INTUITIVE SURGICAL, you can compare the effects of market volatilities on Postal Savings and INTUITIVE SURGICAL 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 Postal Savings with a short position of INTUITIVE SURGICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postal Savings and INTUITIVE SURGICAL.
Diversification Opportunities for Postal Savings and INTUITIVE SURGICAL
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Postal and INTUITIVE is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Postal Savings Bank and INTUITIVE SURGICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE SURGICAL and Postal Savings 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 Postal Savings Bank are associated (or correlated) with INTUITIVE SURGICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTUITIVE SURGICAL has no effect on the direction of Postal Savings i.e., Postal Savings and INTUITIVE SURGICAL go up and down completely randomly.
Pair Corralation between Postal Savings and INTUITIVE SURGICAL
Assuming the 90 days horizon Postal Savings Bank is expected to under-perform the INTUITIVE SURGICAL. In addition to that, Postal Savings is 1.3 times more volatile than INTUITIVE SURGICAL. It trades about -0.03 of its total potential returns per unit of risk. INTUITIVE SURGICAL is currently generating about 0.39 per unit of volatility. If you would invest 47,210 in INTUITIVE SURGICAL on August 25, 2024 and sell it today you would earn a total of 6,170 from holding INTUITIVE SURGICAL or generate 13.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postal Savings Bank vs. INTUITIVE SURGICAL
Performance |
| Timeline |
| Postal Savings Bank |
| INTUITIVE SURGICAL |
Postal Savings and INTUITIVE SURGICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postal Savings and INTUITIVE SURGICAL
The main advantage of trading using opposite Postal Savings and INTUITIVE SURGICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postal Savings position performs unexpectedly, INTUITIVE SURGICAL 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 INTUITIVE SURGICAL will offset losses from the drop in INTUITIVE SURGICAL's long position.| Postal Savings vs. Deutsche Bank Aktiengesellschaft | Postal Savings vs. Superior Plus Corp | Postal Savings vs. NMI Holdings | Postal Savings vs. Origin Agritech |
| INTUITIVE SURGICAL vs. PennantPark Investment | INTUITIVE SURGICAL vs. Lion One Metals | INTUITIVE SURGICAL vs. SLR Investment Corp | INTUITIVE SURGICAL vs. Apollo Investment Corp |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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