Correlation Between Salesforce and Shanghai Broadband
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By analyzing existing cross correlation between Salesforce and Shanghai Broadband Technology, you can compare the effects of market volatilities on Salesforce and Shanghai Broadband 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 Shanghai Broadband. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Shanghai Broadband.
Diversification Opportunities for Salesforce and Shanghai Broadband
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Salesforce and Shanghai is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Shanghai Broadband Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Broadband 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 Shanghai Broadband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Broadband has no effect on the direction of Salesforce i.e., Salesforce and Shanghai Broadband go up and down completely randomly.
Pair Corralation between Salesforce and Shanghai Broadband
Considering the 90-day investment horizon Salesforce is expected to generate 1.54 times less return on investment than Shanghai Broadband. But when comparing it to its historical volatility, Salesforce is 1.13 times less risky than Shanghai Broadband. It trades about 0.28 of its potential returns per unit of risk. Shanghai Broadband Technology is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 335.00 in Shanghai Broadband Technology on September 1, 2024 and sell it today you would earn a total of 75.00 from holding Shanghai Broadband Technology or generate 22.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Salesforce vs. Shanghai Broadband Technology
Performance |
| Timeline |
| Salesforce |
| Shanghai Broadband |
Salesforce and Shanghai Broadband Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Shanghai Broadband
The main advantage of trading using opposite Salesforce and Shanghai Broadband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Shanghai Broadband 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 Shanghai Broadband will offset losses from the drop in Shanghai Broadband's long position.| Salesforce vs. Ke Holdings | Salesforce vs. nCino Inc | Salesforce vs. Kingsoft Cloud Holdings | Salesforce vs. Jfrog |
| Shanghai Broadband vs. Zijin Mining Group | Shanghai Broadband vs. Wanhua Chemical Group | Shanghai Broadband vs. Baoshan Iron Steel | Shanghai Broadband vs. Shandong Gold Mining |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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