Correlation Between Anglo American and INTUITIVE SURGICAL

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

By analyzing existing cross correlation between Anglo American plc and INTUITIVE SURGICAL, you can compare the effects of market volatilities on Anglo American 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 Anglo American with a short position of INTUITIVE SURGICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anglo American and INTUITIVE SURGICAL.

Diversification Opportunities for Anglo American and INTUITIVE SURGICAL

0.61

Correlation Coefficient

Anglo American  INTUITIVE SURGICAL

Poor diversification

The 3 months correlation between Anglo and INTUITIVE is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Anglo American plc and INTUITIVE SURGICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTUITIVE SURGICAL and Anglo American 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 Anglo American plc 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 Anglo American i.e., Anglo American and INTUITIVE SURGICAL go up and down completely randomly.

Pair Corralation between Anglo American and INTUITIVE SURGICAL

Assuming the 90 days trading horizon Anglo American plc is expected to under-perform the INTUITIVE SURGICAL. In addition to that, Anglo American is 1.91 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 0.1 per unit of volatility. If you would invest  40,420  in INTUITIVE SURGICAL on April 22, 2025 and sell it today you would earn a total of  3,880  from holding INTUITIVE SURGICAL or generate 9.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Anglo American plc  vs.  INTUITIVE SURGICAL

Anglo American plc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Anglo American plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental drivers, Anglo American is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

INTUITIVE SURGICAL

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in INTUITIVE SURGICAL are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, INTUITIVE SURGICAL may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Anglo American and INTUITIVE SURGICAL

The main advantage of trading using opposite Anglo American and INTUITIVE SURGICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anglo American 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 Anglo American plc 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.