Correlation Between Roper Technologies and Intuitive Investments

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

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

Diversification Opportunities for Roper Technologies and Intuitive Investments

0.03

Correlation Coefficient

Roper Technologies  Intuitive Investments

Significant diversification

The 3 months correlation between Roper and Intuitive is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Roper Technologies and Intuitive Investments Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuitive Investments and Roper Technologies 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 Roper Technologies are associated (or correlated) with Intuitive Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intuitive Investments has no effect on the direction of Roper Technologies i.e., Roper Technologies and Intuitive Investments go up and down completely randomly.

Pair Corralation between Roper Technologies and Intuitive Investments

Assuming the 90 days trading horizon Roper Technologies is expected to generate 10.28 times more return on investment than Intuitive Investments. However, Roper Technologies is 10.28 times more volatile than Intuitive Investments Group. It trades about 0.04 of its potential returns per unit of risk. Intuitive Investments Group is currently generating about -0.12 per unit of risk. If you would invest  56,321  in Roper Technologies on September 25, 2024 and sell it today you would lose (3,712) from holding Roper Technologies or give up 6.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.22%
Values	Daily Returns

Roper Technologies  vs.  Intuitive Investments Group

Roper Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Roper Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Roper Technologies is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Intuitive Investments

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intuitive Investments Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Roper Technologies and Intuitive Investments

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

The idea behind Roper Technologies and Intuitive Investments Group 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.