Correlation Between ESSILORLUXOTTICA and Intuitive Surgical

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

By analyzing existing cross correlation between ESSILORLUXOTTICA 12ON and Intuitive Surgical, you can compare the effects of market volatilities on ESSILORLUXOTTICA 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 ESSILORLUXOTTICA with a short position of Intuitive Surgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of ESSILORLUXOTTICA and Intuitive Surgical.

Diversification Opportunities for ESSILORLUXOTTICA and Intuitive Surgical

0.4

Correlation Coefficient

ESSILORLUXOTTICA  Intuitive Surgical

Very weak diversification

The 3 months correlation between ESSILORLUXOTTICA and Intuitive is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding ESSILORLUXOTTICA 12ON and Intuitive Surgical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Surgical and ESSILORLUXOTTICA 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 ESSILORLUXOTTICA 12ON 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 ESSILORLUXOTTICA i.e., ESSILORLUXOTTICA and Intuitive Surgical go up and down completely randomly.

Pair Corralation between ESSILORLUXOTTICA and Intuitive Surgical

Assuming the 90 days trading horizon ESSILORLUXOTTICA 12ON is expected to generate 2.43 times more return on investment than Intuitive Surgical. However, ESSILORLUXOTTICA is 2.43 times more volatile than Intuitive Surgical. It trades about 0.07 of its potential returns per unit of risk. Intuitive Surgical is currently generating about 0.0 per unit of risk. If you would invest  12,000  in ESSILORLUXOTTICA 12ON on April 21, 2025 and sell it today you would earn a total of  400.00  from holding ESSILORLUXOTTICA 12ON or generate 3.33% return on investment over 90 days.

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

ESSILORLUXOTTICA 12ON  vs.  Intuitive Surgical

ESSILORLUXOTTICA 12ON

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ESSILORLUXOTTICA 12ON are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable essential indicators, ESSILORLUXOTTICA is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Intuitive Surgical

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Intuitive Surgical are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward indicators, Intuitive Surgical may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with ESSILORLUXOTTICA and Intuitive Surgical

The main advantage of trading using opposite ESSILORLUXOTTICA and Intuitive Surgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ESSILORLUXOTTICA 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 ESSILORLUXOTTICA 12ON 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.