Correlation Between Rocky Brands and Intuitive Surgical
Can any of the company-specific risk be diversified away by investing in both Rocky Brands 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 Rocky Brands and Intuitive Surgical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rocky Brands and Intuitive Surgical, you can compare the effects of market volatilities on Rocky Brands 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 Rocky Brands with a short position of Intuitive Surgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rocky Brands and Intuitive Surgical.
Diversification Opportunities for Rocky Brands and Intuitive Surgical
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rocky and Intuitive is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Rocky Brands and Intuitive Surgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Surgical and Rocky Brands 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 Rocky Brands 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 Rocky Brands i.e., Rocky Brands and Intuitive Surgical go up and down completely randomly.
Pair Corralation between Rocky Brands and Intuitive Surgical
Given the investment horizon of 90 days Rocky Brands is expected to generate 0.78 times more return on investment than Intuitive Surgical. However, Rocky Brands is 1.28 times less risky than Intuitive Surgical. It trades about 0.37 of its potential returns per unit of risk. Intuitive Surgical is currently generating about 0.24 per unit of risk. If you would invest 2,249 in Rocky Brands on November 2, 2024 and sell it today you would earn a total of 302.00 from holding Rocky Brands or generate 13.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rocky Brands vs. Intuitive Surgical
Performance |
| Timeline |
| Rocky Brands |
| Intuitive Surgical |
Rocky Brands and Intuitive Surgical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rocky Brands and Intuitive Surgical
The main advantage of trading using opposite Rocky Brands and Intuitive Surgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rocky Brands 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.| Rocky Brands vs. Vera Bradley | Rocky Brands vs. Steven Madden | Rocky Brands vs. Wolverine World Wide | Rocky Brands vs. Caleres |
| Intuitive Surgical vs. Repligen | Intuitive Surgical vs. ResMed Inc | Intuitive Surgical vs. Merit Medical Systems | Intuitive Surgical vs. ICU Medical |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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