Correlation Between INTUITIVE SURGICAL and NMI Holdings
Can any of the company-specific risk be diversified away by investing in both INTUITIVE SURGICAL and NMI Holdings 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 INTUITIVE SURGICAL and NMI Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTUITIVE SURGICAL and NMI Holdings, you can compare the effects of market volatilities on INTUITIVE SURGICAL and NMI Holdings 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 INTUITIVE SURGICAL with a short position of NMI Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTUITIVE SURGICAL and NMI Holdings.
Diversification Opportunities for INTUITIVE SURGICAL and NMI Holdings
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between INTUITIVE and NMI is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding INTUITIVE SURGICAL and NMI Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NMI Holdings and INTUITIVE SURGICAL 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 INTUITIVE SURGICAL are associated (or correlated) with NMI Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NMI Holdings has no effect on the direction of INTUITIVE SURGICAL i.e., INTUITIVE SURGICAL and NMI Holdings go up and down completely randomly.
Pair Corralation between INTUITIVE SURGICAL and NMI Holdings
Assuming the 90 days trading horizon INTUITIVE SURGICAL is expected to generate 0.68 times more return on investment than NMI Holdings. However, INTUITIVE SURGICAL is 1.47 times less risky than NMI Holdings. It trades about 0.31 of its potential returns per unit of risk. NMI Holdings is currently generating about 0.05 per unit of risk. If you would invest 47,325 in INTUITIVE SURGICAL on August 28, 2024 and sell it today you would earn a total of 5,025 from holding INTUITIVE SURGICAL or generate 10.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTUITIVE SURGICAL vs. NMI Holdings
Performance |
| Timeline |
| INTUITIVE SURGICAL |
| NMI Holdings |
INTUITIVE SURGICAL and NMI Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTUITIVE SURGICAL and NMI Holdings
The main advantage of trading using opposite INTUITIVE SURGICAL and NMI Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTUITIVE SURGICAL position performs unexpectedly, NMI Holdings 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 NMI Holdings will offset losses from the drop in NMI Holdings' long position.| INTUITIVE SURGICAL vs. PENN NATL GAMING | INTUITIVE SURGICAL vs. GAMING FAC SA | INTUITIVE SURGICAL vs. Xinhua Winshare Publishing | INTUITIVE SURGICAL vs. TSOGO SUN GAMING |
| NMI Holdings vs. Lion Biotechnologies | NMI Holdings vs. Digilife Technologies Limited | NMI Holdings vs. Food Life Companies | NMI Holdings vs. CONAGRA FOODS |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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