Correlation Between Salesforce and Sibanye Stillwater
Can any of the company-specific risk be diversified away by investing in both Salesforce and Sibanye Stillwater 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 Salesforce and Sibanye Stillwater into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Sibanye Stillwater Limited, you can compare the effects of market volatilities on Salesforce and Sibanye Stillwater 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 Salesforce with a short position of Sibanye Stillwater. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Sibanye Stillwater.
Diversification Opportunities for Salesforce and Sibanye Stillwater
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Salesforce and Sibanye is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Sibanye Stillwater Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sibanye Stillwater and Salesforce 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 Salesforce are associated (or correlated) with Sibanye Stillwater. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sibanye Stillwater has no effect on the direction of Salesforce i.e., Salesforce and Sibanye Stillwater go up and down completely randomly.
Pair Corralation between Salesforce and Sibanye Stillwater
Considering the 90-day investment horizon Salesforce is expected to under-perform the Sibanye Stillwater. But the stock apears to be less risky and, when comparing its historical volatility, Salesforce is 3.86 times less risky than Sibanye Stillwater. The stock trades about -0.28 of its potential returns per unit of risk. The Sibanye Stillwater Limited is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 84.00 in Sibanye Stillwater Limited on October 23, 2024 and sell it today you would earn a total of 1.00 from holding Sibanye Stillwater Limited or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 88.89% |
| Values | Daily Returns |
Salesforce vs. Sibanye Stillwater Limited
Performance |
| Timeline |
| Salesforce |
| Sibanye Stillwater |
Salesforce and Sibanye Stillwater Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Sibanye Stillwater
The main advantage of trading using opposite Salesforce and Sibanye Stillwater positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Sibanye Stillwater 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 Sibanye Stillwater will offset losses from the drop in Sibanye Stillwater's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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