Correlation Between INTUITIVE SURGICAL and AIA Group
Can any of the company-specific risk be diversified away by investing in both INTUITIVE SURGICAL and AIA Group 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 AIA Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTUITIVE SURGICAL and AIA Group Limited, you can compare the effects of market volatilities on INTUITIVE SURGICAL and AIA Group 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 AIA Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTUITIVE SURGICAL and AIA Group.
Diversification Opportunities for INTUITIVE SURGICAL and AIA Group
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between INTUITIVE and AIA is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding INTUITIVE SURGICAL and AIA Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIA Group Limited 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 AIA Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIA Group Limited has no effect on the direction of INTUITIVE SURGICAL i.e., INTUITIVE SURGICAL and AIA Group go up and down completely randomly.
Pair Corralation between INTUITIVE SURGICAL and AIA Group
Assuming the 90 days trading horizon INTUITIVE SURGICAL is expected to generate 2.25 times less return on investment than AIA Group. But when comparing it to its historical volatility, INTUITIVE SURGICAL is 1.8 times less risky than AIA Group. It trades about 0.07 of its potential returns per unit of risk. AIA Group Limited is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 665.00 in AIA Group Limited on November 28, 2024 and sell it today you would earn a total of 30.00 from holding AIA Group Limited or generate 4.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTUITIVE SURGICAL vs. AIA Group Limited
Performance |
| Timeline |
| INTUITIVE SURGICAL |
| AIA Group Limited |
INTUITIVE SURGICAL and AIA Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTUITIVE SURGICAL and AIA Group
The main advantage of trading using opposite INTUITIVE SURGICAL and AIA Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTUITIVE SURGICAL position performs unexpectedly, AIA Group 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 AIA Group will offset losses from the drop in AIA Group's long position.| INTUITIVE SURGICAL vs. Insteel Industries | INTUITIVE SURGICAL vs. CALTAGIRONE EDITORE | INTUITIVE SURGICAL vs. Samsung Electronics Co | INTUITIVE SURGICAL vs. United Microelectronics |
| AIA Group vs. Chiba Bank | AIA Group vs. PT Bank Maybank | AIA Group vs. BioNTech SE | AIA Group vs. Allegheny Technologies Incorporated |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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