Correlation Between Air Lease and Intuitive Surgical
Can any of the company-specific risk be diversified away by investing in both Air Lease 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 Air Lease and Intuitive Surgical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Lease and Intuitive Surgical, you can compare the effects of market volatilities on Air Lease 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 Air Lease with a short position of Intuitive Surgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Lease and Intuitive Surgical.
Diversification Opportunities for Air Lease and Intuitive Surgical
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Air and Intuitive is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Air Lease and Intuitive Surgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Surgical and Air Lease 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 Air Lease 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 Air Lease i.e., Air Lease and Intuitive Surgical go up and down completely randomly.
Pair Corralation between Air Lease and Intuitive Surgical
Assuming the 90 days trading horizon Air Lease is expected to generate 1.33 times more return on investment than Intuitive Surgical. However, Air Lease is 1.33 times more volatile than Intuitive Surgical. It trades about 0.06 of its potential returns per unit of risk. Intuitive Surgical is currently generating about -0.09 per unit of risk. If you would invest 4,440 in Air Lease on December 1, 2024 and sell it today you would earn a total of 100.00 from holding Air Lease or generate 2.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Lease vs. Intuitive Surgical
Performance |
| Timeline |
| Air Lease |
| Intuitive Surgical |
Air Lease and Intuitive Surgical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Lease and Intuitive Surgical
The main advantage of trading using opposite Air Lease and Intuitive Surgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Lease 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.| Air Lease vs. Columbia Sportswear | Air Lease vs. Magic Software Enterprises | Air Lease vs. Alfa Financial Software | Air Lease vs. Constellation Software |
| Intuitive Surgical vs. United Natural Foods | Intuitive Surgical vs. MONEYSUPERMARKET | Intuitive Surgical vs. Scottish Mortgage Investment | Intuitive Surgical vs. Keck Seng Investments |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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