Correlation Between ZhongAn Online and Salesforce
Can any of the company-specific risk be diversified away by investing in both ZhongAn Online and Salesforce 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 ZhongAn Online and Salesforce into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZhongAn Online P and Salesforce, you can compare the effects of market volatilities on ZhongAn Online and Salesforce 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 ZhongAn Online with a short position of Salesforce. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZhongAn Online and Salesforce.
Diversification Opportunities for ZhongAn Online and Salesforce
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ZhongAn and Salesforce is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding ZhongAn Online P and Salesforce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salesforce and ZhongAn Online 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 ZhongAn Online P are associated (or correlated) with Salesforce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salesforce has no effect on the direction of ZhongAn Online i.e., ZhongAn Online and Salesforce go up and down completely randomly.
Pair Corralation between ZhongAn Online and Salesforce
Assuming the 90 days trading horizon ZhongAn Online is expected to generate 1.58 times less return on investment than Salesforce. In addition to that, ZhongAn Online is 1.83 times more volatile than Salesforce. It trades about 0.02 of its total potential returns per unit of risk. Salesforce is currently generating about 0.05 per unit of volatility. If you would invest 26,580 in Salesforce on November 3, 2024 and sell it today you would earn a total of 6,865 from holding Salesforce or generate 25.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZhongAn Online P vs. Salesforce
Performance |
| Timeline |
| ZhongAn Online P |
| Salesforce |
ZhongAn Online and Salesforce Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZhongAn Online and Salesforce
The main advantage of trading using opposite ZhongAn Online and Salesforce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZhongAn Online position performs unexpectedly, Salesforce 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 Salesforce will offset losses from the drop in Salesforce's long position.| ZhongAn Online vs. SIVERS SEMICONDUCTORS AB | ZhongAn Online vs. NorAm Drilling AS | ZhongAn Online vs. Volkswagen AG | ZhongAn Online vs. Darden Restaurants |
| Salesforce vs. OPKO HEALTH | Salesforce vs. Aedas Homes SA | Salesforce vs. Planet Fitness | Salesforce vs. CENTURIA OFFICE REIT |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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