Correlation Between Intuitive Surgical and Solidion Technology

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

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

Diversification Opportunities for Intuitive Surgical and Solidion Technology

0.29

Correlation Coefficient

Intuitive Surgical  Solidion Technology

Modest diversification

The 3 months correlation between Intuitive and Solidion is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Intuitive Surgical and Solidion Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solidion Technology and Intuitive Surgical 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 Intuitive Surgical are associated (or correlated) with Solidion Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solidion Technology has no effect on the direction of Intuitive Surgical i.e., Intuitive Surgical and Solidion Technology go up and down completely randomly.

Pair Corralation between Intuitive Surgical and Solidion Technology

Given the investment horizon of 90 days Intuitive Surgical is expected to under-perform the Solidion Technology. But the stock apears to be less risky and, when comparing its historical volatility, Intuitive Surgical is 13.65 times less risky than Solidion Technology. The stock trades about -0.02 of its potential returns per unit of risk. The Solidion Technology is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest  42.00  in Solidion Technology on October 8, 2024 and sell it today you would earn a total of  35.00  from holding Solidion Technology or generate 83.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Intuitive Surgical  vs.  Solidion Technology

Intuitive Surgical

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intuitive Surgical are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating basic indicators, Intuitive Surgical may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Solidion Technology

Risk-Adjusted Performance

11 of 100

Good

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

Pair Trading with Intuitive Surgical and Solidion Technology

The main advantage of trading using opposite Intuitive Surgical and Solidion Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intuitive Surgical position performs unexpectedly, Solidion Technology 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 Solidion Technology will offset losses from the drop in Solidion Technology's long position.

The idea behind Intuitive Surgical and Solidion Technology 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.

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 Transaction History module to view history of all your transactions and understand their impact on performance.