Correlation Between PLAYTECH and INTUITIVE SURGICAL
Can any of the company-specific risk be diversified away by investing in both PLAYTECH 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 PLAYTECH and INTUITIVE SURGICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLAYTECH and INTUITIVE SURGICAL, you can compare the effects of market volatilities on PLAYTECH 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 PLAYTECH with a short position of INTUITIVE SURGICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYTECH and INTUITIVE SURGICAL.
Diversification Opportunities for PLAYTECH and INTUITIVE SURGICAL
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between PLAYTECH and INTUITIVE is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding PLAYTECH and INTUITIVE SURGICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE SURGICAL and PLAYTECH 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 PLAYTECH 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 PLAYTECH i.e., PLAYTECH and INTUITIVE SURGICAL go up and down completely randomly.
Pair Corralation between PLAYTECH and INTUITIVE SURGICAL
Assuming the 90 days trading horizon PLAYTECH is expected to generate 3.46 times less return on investment than INTUITIVE SURGICAL. But when comparing it to its historical volatility, PLAYTECH is 1.41 times less risky than INTUITIVE SURGICAL. It trades about 0.1 of its potential returns per unit of risk. INTUITIVE SURGICAL is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 50,360 in INTUITIVE SURGICAL on November 3, 2024 and sell it today you would earn a total of 6,110 from holding INTUITIVE SURGICAL or generate 12.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
PLAYTECH vs. INTUITIVE SURGICAL
Performance |
| Timeline |
| PLAYTECH |
| INTUITIVE SURGICAL |
PLAYTECH and INTUITIVE SURGICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLAYTECH and INTUITIVE SURGICAL
The main advantage of trading using opposite PLAYTECH and INTUITIVE SURGICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLAYTECH 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.| PLAYTECH vs. Live Nation Entertainment | PLAYTECH vs. ATRESMEDIA | PLAYTECH vs. DISTRICT METALS | PLAYTECH vs. ARDAGH METAL PACDL 0001 |
| INTUITIVE SURGICAL vs. Thai Beverage Public | INTUITIVE SURGICAL vs. Yuexiu Transport Infrastructure | INTUITIVE SURGICAL vs. Osisko Metals | INTUITIVE SURGICAL vs. DAIDO METAL TD |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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