Correlation Between Neste Oyj and INTUITIVE SURGICAL
Can any of the company-specific risk be diversified away by investing in both Neste Oyj 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 Neste Oyj and INTUITIVE SURGICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neste Oyj and INTUITIVE SURGICAL, you can compare the effects of market volatilities on Neste Oyj 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 Neste Oyj with a short position of INTUITIVE SURGICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neste Oyj and INTUITIVE SURGICAL.
Diversification Opportunities for Neste Oyj and INTUITIVE SURGICAL
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Neste and INTUITIVE is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Neste Oyj and INTUITIVE SURGICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE SURGICAL and Neste Oyj 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 Neste Oyj 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 Neste Oyj i.e., Neste Oyj and INTUITIVE SURGICAL go up and down completely randomly.
Pair Corralation between Neste Oyj and INTUITIVE SURGICAL
Assuming the 90 days horizon Neste Oyj is expected to under-perform the INTUITIVE SURGICAL. In addition to that, Neste Oyj is 1.68 times more volatile than INTUITIVE SURGICAL. It trades about -0.08 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 36,730 in INTUITIVE SURGICAL on September 1, 2024 and sell it today you would earn a total of 14,470 from holding INTUITIVE SURGICAL or generate 39.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neste Oyj vs. INTUITIVE SURGICAL
Performance |
| Timeline |
| Neste Oyj |
| INTUITIVE SURGICAL |
Neste Oyj and INTUITIVE SURGICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neste Oyj and INTUITIVE SURGICAL
The main advantage of trading using opposite Neste Oyj and INTUITIVE SURGICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neste Oyj 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.| Neste Oyj vs. Astral Foods Limited | Neste Oyj vs. Tyson Foods | Neste Oyj vs. Lifeway Foods | Neste Oyj vs. UNIVERSAL MUSIC GROUP |
| INTUITIVE SURGICAL vs. Gold Road Resources | INTUITIVE SURGICAL vs. Gaztransport Technigaz SA | INTUITIVE SURGICAL vs. COPLAND ROAD CAPITAL | INTUITIVE SURGICAL vs. Singapore Airlines Limited |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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