Correlation Between Procter Gamble and INTUITIVE SURGICAL
Can any of the company-specific risk be diversified away by investing in both Procter Gamble 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 Procter Gamble and INTUITIVE SURGICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Procter Gamble and INTUITIVE SURGICAL, you can compare the effects of market volatilities on Procter Gamble 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 Procter Gamble with a short position of INTUITIVE SURGICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and INTUITIVE SURGICAL.
Diversification Opportunities for Procter Gamble and INTUITIVE SURGICAL
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Procter and INTUITIVE is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding The Procter Gamble and INTUITIVE SURGICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE SURGICAL and Procter Gamble 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 The Procter Gamble 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 Procter Gamble i.e., Procter Gamble and INTUITIVE SURGICAL go up and down completely randomly.
Pair Corralation between Procter Gamble and INTUITIVE SURGICAL
Assuming the 90 days horizon The Procter Gamble is expected to generate 0.72 times more return on investment than INTUITIVE SURGICAL. However, The Procter Gamble is 1.39 times less risky than INTUITIVE SURGICAL. It trades about 0.36 of its potential returns per unit of risk. INTUITIVE SURGICAL is currently generating about 0.23 per unit of risk. If you would invest 15,498 in The Procter Gamble on August 30, 2024 and sell it today you would earn a total of 1,506 from holding The Procter Gamble or generate 9.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Procter Gamble vs. INTUITIVE SURGICAL
Performance |
| Timeline |
| Procter Gamble |
| INTUITIVE SURGICAL |
Procter Gamble and INTUITIVE SURGICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and INTUITIVE SURGICAL
The main advantage of trading using opposite Procter Gamble and INTUITIVE SURGICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble 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.| Procter Gamble vs. Verizon Communications | Procter Gamble vs. Lamar Advertising | Procter Gamble vs. Hemisphere Energy Corp | Procter Gamble vs. COMPUTERSHARE |
| INTUITIVE SURGICAL vs. INFORMATION SVC GRP | INTUITIVE SURGICAL vs. Fidelity National Information | INTUITIVE SURGICAL vs. DATANG INTL POW | INTUITIVE SURGICAL vs. DICKER DATA LTD |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |