Correlation Between Kingdee International and INTUITIVE SURGICAL
Can any of the company-specific risk be diversified away by investing in both Kingdee International 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 Kingdee International and INTUITIVE SURGICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingdee International Software and INTUITIVE SURGICAL, you can compare the effects of market volatilities on Kingdee International 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 Kingdee International with a short position of INTUITIVE SURGICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingdee International and INTUITIVE SURGICAL.
Diversification Opportunities for Kingdee International and INTUITIVE SURGICAL
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kingdee and INTUITIVE is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Kingdee International Software and INTUITIVE SURGICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE SURGICAL and Kingdee International 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 Kingdee International Software 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 Kingdee International i.e., Kingdee International and INTUITIVE SURGICAL go up and down completely randomly.
Pair Corralation between Kingdee International and INTUITIVE SURGICAL
Assuming the 90 days trading horizon Kingdee International Software is expected to under-perform the INTUITIVE SURGICAL. In addition to that, Kingdee International is 2.12 times more volatile than INTUITIVE SURGICAL. It trades about -0.02 of its total potential returns per unit of risk. INTUITIVE SURGICAL is currently generating about 0.11 per unit of volatility. If you would invest 23,650 in INTUITIVE SURGICAL on October 27, 2024 and sell it today you would earn a total of 32,850 from holding INTUITIVE SURGICAL or generate 138.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kingdee International Software vs. INTUITIVE SURGICAL
Performance |
| Timeline |
| Kingdee International |
| INTUITIVE SURGICAL |
Kingdee International and INTUITIVE SURGICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingdee International and INTUITIVE SURGICAL
The main advantage of trading using opposite Kingdee International and INTUITIVE SURGICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingdee International 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.| Kingdee International vs. Palo Alto Networks | Kingdee International vs. Fortinet | Kingdee International vs. Autodesk | Kingdee International vs. HubSpot |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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