Correlation Between INTUITIVE SURGICAL and Stora Enso
Can any of the company-specific risk be diversified away by investing in both INTUITIVE SURGICAL and Stora Enso 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 Stora Enso into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTUITIVE SURGICAL and Stora Enso Oyj, you can compare the effects of market volatilities on INTUITIVE SURGICAL and Stora Enso 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 Stora Enso. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTUITIVE SURGICAL and Stora Enso.
Diversification Opportunities for INTUITIVE SURGICAL and Stora Enso
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between INTUITIVE and Stora is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding INTUITIVE SURGICAL and Stora Enso Oyj in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stora Enso Oyj 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 Stora Enso. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stora Enso Oyj has no effect on the direction of INTUITIVE SURGICAL i.e., INTUITIVE SURGICAL and Stora Enso go up and down completely randomly.
Pair Corralation between INTUITIVE SURGICAL and Stora Enso
Assuming the 90 days trading horizon INTUITIVE SURGICAL is expected to generate 1.45 times more return on investment than Stora Enso. However, INTUITIVE SURGICAL is 1.45 times more volatile than Stora Enso Oyj. It trades about 0.31 of its potential returns per unit of risk. Stora Enso Oyj is currently generating about -0.61 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 | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTUITIVE SURGICAL vs. Stora Enso Oyj
Performance |
| Timeline |
| INTUITIVE SURGICAL |
| Stora Enso Oyj |
INTUITIVE SURGICAL and Stora Enso Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTUITIVE SURGICAL and Stora Enso
The main advantage of trading using opposite INTUITIVE SURGICAL and Stora Enso positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTUITIVE SURGICAL position performs unexpectedly, Stora Enso 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 Stora Enso will offset losses from the drop in Stora Enso's 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 |
| Stora Enso vs. UPM Kymmene Oyj | Stora Enso vs. STORA ENSO OYJ | Stora Enso vs. Suzano SA | Stora Enso vs. Nine Dragons Paper |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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