Correlation Between Sartorius Stedim and Intuitive Surgical

Can any of the company-specific risk be diversified away by investing in both Sartorius Stedim 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 Sartorius Stedim and Intuitive Surgical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sartorius Stedim Biotech and Intuitive Surgical, you can compare the effects of market volatilities on Sartorius Stedim 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 Sartorius Stedim with a short position of Intuitive Surgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sartorius Stedim and Intuitive Surgical.

Diversification Opportunities for Sartorius Stedim and Intuitive Surgical

-0.22

Correlation Coefficient

Sartorius Stedim  Intuitive Surgical

Very good diversification

The 3 months correlation between Sartorius and Intuitive is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Sartorius Stedim Biotech and Intuitive Surgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Surgical and Sartorius Stedim 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 Sartorius Stedim Biotech 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 Sartorius Stedim i.e., Sartorius Stedim and Intuitive Surgical go up and down completely randomly.

Pair Corralation between Sartorius Stedim and Intuitive Surgical

Assuming the 90 days trading horizon Sartorius Stedim Biotech is expected to under-perform the Intuitive Surgical. In addition to that, Sartorius Stedim is 2.06 times more volatile than Intuitive Surgical. It trades about -0.01 of its total potential returns per unit of risk. Intuitive Surgical is currently generating about 0.15 per unit of volatility. If you would invest  44,365  in Intuitive Surgical on September 12, 2024 and sell it today you would earn a total of  7,385  from holding Intuitive Surgical or generate 16.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Sartorius Stedim Biotech  vs.  Intuitive Surgical

Sartorius Stedim Biotech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sartorius Stedim Biotech has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Sartorius Stedim is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Intuitive Surgical

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Intuitive Surgical are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady forward indicators, Intuitive Surgical reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sartorius Stedim and Intuitive Surgical

The main advantage of trading using opposite Sartorius Stedim and Intuitive Surgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sartorius Stedim 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.

The idea behind Sartorius Stedim Biotech and Intuitive Surgical pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.