Correlation Between Samsung Electronics and Intuitive Surgical
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics 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 Samsung Electronics and Intuitive Surgical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Electronics Co and Intuitive Surgical, you can compare the effects of market volatilities on Samsung Electronics 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 Samsung Electronics with a short position of Intuitive Surgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Intuitive Surgical.
Diversification Opportunities for Samsung Electronics and Intuitive Surgical
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and Intuitive is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Intuitive Surgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Surgical and Samsung Electronics 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 Samsung Electronics Co 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 Samsung Electronics i.e., Samsung Electronics and Intuitive Surgical go up and down completely randomly.
Pair Corralation between Samsung Electronics and Intuitive Surgical
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Intuitive Surgical. In addition to that, Samsung Electronics is 1.28 times more volatile than Intuitive Surgical. It trades about -0.06 of its total potential returns per unit of risk. Intuitive Surgical is currently generating about 0.13 per unit of volatility. If you would invest 33,335 in Intuitive Surgical on September 14, 2024 and sell it today you would earn a total of 21,515 from holding Intuitive Surgical or generate 64.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 98.81% |
| Values | Daily Returns |
Samsung Electronics Co vs. Intuitive Surgical
Performance |
| Timeline |
| Samsung Electronics |
| Intuitive Surgical |
Samsung Electronics and Intuitive Surgical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Intuitive Surgical
The main advantage of trading using opposite Samsung Electronics and Intuitive Surgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics 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.| Samsung Electronics vs. European Metals Holdings | Samsung Electronics vs. Axfood AB | Samsung Electronics vs. McEwen Mining | Samsung Electronics vs. Roebuck Food Group |
| Intuitive Surgical vs. Samsung Electronics Co | Intuitive Surgical vs. Samsung Electronics Co | Intuitive Surgical vs. Hyundai Motor | Intuitive Surgical vs. Reliance Industries 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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