Correlation Between United Natural and Intuitive Surgical
Can any of the company-specific risk be diversified away by investing in both United Natural 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 United Natural and Intuitive Surgical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Natural Foods and Intuitive Surgical, you can compare the effects of market volatilities on United Natural 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 United Natural with a short position of Intuitive Surgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Natural and Intuitive Surgical.
Diversification Opportunities for United Natural and Intuitive Surgical
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between United and Intuitive is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding United Natural Foods and Intuitive Surgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Surgical and United Natural 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 United Natural Foods 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 United Natural i.e., United Natural and Intuitive Surgical go up and down completely randomly.
Pair Corralation between United Natural and Intuitive Surgical
Assuming the 90 days horizon United Natural Foods is expected to generate 2.19 times more return on investment than Intuitive Surgical. However, United Natural is 2.19 times more volatile than Intuitive Surgical. It trades about 0.37 of its potential returns per unit of risk. Intuitive Surgical is currently generating about 0.44 per unit of risk. If you would invest 1,820 in United Natural Foods on August 28, 2024 and sell it today you would earn a total of 390.00 from holding United Natural Foods or generate 21.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Natural Foods vs. Intuitive Surgical
Performance |
| Timeline |
| United Natural Foods |
| Intuitive Surgical |
United Natural and Intuitive Surgical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Natural and Intuitive Surgical
The main advantage of trading using opposite United Natural and Intuitive Surgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Natural 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.| United Natural vs. Lion One Metals | United Natural vs. LION ONE METALS | United Natural vs. GREENX METALS LTD | United Natural vs. Harmony Gold Mining |
| Intuitive Surgical vs. Superior Plus Corp | Intuitive Surgical vs. NMI Holdings | Intuitive Surgical vs. Origin Agritech | Intuitive Surgical vs. SIVERS SEMICONDUCTORS AB |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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