Correlation Between Sabra Health and INTUITIVE SURGICAL
Can any of the company-specific risk be diversified away by investing in both Sabra Health 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 Sabra Health and INTUITIVE SURGICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabra Health Care and INTUITIVE SURGICAL, you can compare the effects of market volatilities on Sabra Health 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 Sabra Health with a short position of INTUITIVE SURGICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabra Health and INTUITIVE SURGICAL.
Diversification Opportunities for Sabra Health and INTUITIVE SURGICAL
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sabra and INTUITIVE is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Sabra Health Care and INTUITIVE SURGICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE SURGICAL and Sabra Health 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 Sabra Health Care 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 Sabra Health i.e., Sabra Health and INTUITIVE SURGICAL go up and down completely randomly.
Pair Corralation between Sabra Health and INTUITIVE SURGICAL
Assuming the 90 days horizon Sabra Health is expected to generate 2.18 times less return on investment than INTUITIVE SURGICAL. But when comparing it to its historical volatility, Sabra Health Care is 1.12 times less risky than INTUITIVE SURGICAL. It trades about 0.12 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 42,730 in INTUITIVE SURGICAL on August 29, 2024 and sell it today you would earn a total of 8,970 from holding INTUITIVE SURGICAL or generate 20.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabra Health Care vs. INTUITIVE SURGICAL
Performance |
| Timeline |
| Sabra Health Care |
| INTUITIVE SURGICAL |
Sabra Health and INTUITIVE SURGICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabra Health and INTUITIVE SURGICAL
The main advantage of trading using opposite Sabra Health and INTUITIVE SURGICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabra Health 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.| Sabra Health vs. Superior Plus Corp | Sabra Health vs. NMI Holdings | Sabra Health vs. SIVERS SEMICONDUCTORS AB | Sabra Health vs. Talanx AG |
| INTUITIVE SURGICAL vs. CARSALESCOM | INTUITIVE SURGICAL vs. Carsales | INTUITIVE SURGICAL vs. CNVISION MEDIA | INTUITIVE SURGICAL vs. CODERE ONLINE LUX |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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