Correlation Between INTUITIVE SURGICAL and Lyxor 1

Can any of the company-specific risk be diversified away by investing in both INTUITIVE SURGICAL and Lyxor 1 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 Lyxor 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between INTUITIVE SURGICAL and Lyxor 1 , you can compare the effects of market volatilities on INTUITIVE SURGICAL and Lyxor 1 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 Lyxor 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTUITIVE SURGICAL and Lyxor 1.

Diversification Opportunities for INTUITIVE SURGICAL and Lyxor 1

0.52

Correlation Coefficient

INTUITIVE SURGICAL  Lyxor 1

Very weak diversification

The 3 months correlation between INTUITIVE and Lyxor is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding INTUITIVE SURGICAL and Lyxor 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyxor 1 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 Lyxor 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyxor 1 has no effect on the direction of INTUITIVE SURGICAL i.e., INTUITIVE SURGICAL and Lyxor 1 go up and down completely randomly.

Pair Corralation between INTUITIVE SURGICAL and Lyxor 1

Assuming the 90 days trading horizon INTUITIVE SURGICAL is expected to generate 1.91 times more return on investment than Lyxor 1. However, INTUITIVE SURGICAL is 1.91 times more volatile than Lyxor 1 . It trades about 0.17 of its potential returns per unit of risk. Lyxor 1 is currently generating about 0.14 per unit of risk. If you would invest  47,005  in INTUITIVE SURGICAL on October 1, 2024 and sell it today you would earn a total of  4,495  from holding INTUITIVE SURGICAL or generate 9.56% return on investment over 90 days.

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

INTUITIVE SURGICAL  vs.  Lyxor 1

INTUITIVE SURGICAL

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in INTUITIVE SURGICAL are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, INTUITIVE SURGICAL exhibited solid returns over the last few months and may actually be approaching a breakup point.

Lyxor 1

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Lyxor 1 are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Lyxor 1 is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with INTUITIVE SURGICAL and Lyxor 1

The main advantage of trading using opposite INTUITIVE SURGICAL and Lyxor 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTUITIVE SURGICAL position performs unexpectedly, Lyxor 1 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 Lyxor 1 will offset losses from the drop in Lyxor 1's long position.

The idea behind INTUITIVE SURGICAL and Lyxor 1 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.