Correlation Between Singapore Airlines and INTUITIVE SURGICAL
Can any of the company-specific risk be diversified away by investing in both Singapore Airlines 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 Singapore Airlines and INTUITIVE SURGICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Singapore Airlines Limited and INTUITIVE SURGICAL, you can compare the effects of market volatilities on Singapore Airlines 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 Singapore Airlines with a short position of INTUITIVE SURGICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singapore Airlines and INTUITIVE SURGICAL.
Diversification Opportunities for Singapore Airlines and INTUITIVE SURGICAL
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Singapore and INTUITIVE is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Singapore Airlines Limited and INTUITIVE SURGICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE SURGICAL and Singapore Airlines 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 Singapore Airlines Limited 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 Singapore Airlines i.e., Singapore Airlines and INTUITIVE SURGICAL go up and down completely randomly.
Pair Corralation between Singapore Airlines and INTUITIVE SURGICAL
Assuming the 90 days trading horizon Singapore Airlines Limited is expected to under-perform the INTUITIVE SURGICAL. But the stock apears to be less risky and, when comparing its historical volatility, Singapore Airlines Limited is 1.61 times less risky than INTUITIVE SURGICAL. The stock trades about -0.04 of its potential returns per unit of risk. The INTUITIVE SURGICAL is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 43,945 in INTUITIVE SURGICAL on September 3, 2024 and sell it today you would earn a total of 7,255 from holding INTUITIVE SURGICAL or generate 16.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Singapore Airlines Limited vs. INTUITIVE SURGICAL
Performance |
| Timeline |
| Singapore Airlines |
| INTUITIVE SURGICAL |
Singapore Airlines and INTUITIVE SURGICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Singapore Airlines and INTUITIVE SURGICAL
The main advantage of trading using opposite Singapore Airlines and INTUITIVE SURGICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Singapore Airlines 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.| Singapore Airlines vs. Delta Air Lines | Singapore Airlines vs. AIR CHINA LTD | Singapore Airlines vs. RYANAIR HLDGS ADR | Singapore Airlines vs. Southwest Airlines Co |
| INTUITIVE SURGICAL vs. MICRONIC MYDATA | INTUITIVE SURGICAL vs. DATANG INTL POW | INTUITIVE SURGICAL vs. Nordic Semiconductor ASA | INTUITIVE SURGICAL vs. ON SEMICONDUCTOR |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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