Correlation Between Salesforce and GLOBAL COSMED
Can any of the company-specific risk be diversified away by investing in both Salesforce and GLOBAL COSMED 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 GLOBAL COSMED into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and GLOBAL MED SA, you can compare the effects of market volatilities on Salesforce and GLOBAL COSMED 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 GLOBAL COSMED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and GLOBAL COSMED.
Diversification Opportunities for Salesforce and GLOBAL COSMED
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Salesforce and GLOBAL is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and GLOBAL MED SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GLOBAL MED SA 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 GLOBAL COSMED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GLOBAL MED SA has no effect on the direction of Salesforce i.e., Salesforce and GLOBAL COSMED go up and down completely randomly.
Pair Corralation between Salesforce and GLOBAL COSMED
Considering the 90-day investment horizon Salesforce is expected to generate 3.48 times less return on investment than GLOBAL COSMED. But when comparing it to its historical volatility, Salesforce is 1.27 times less risky than GLOBAL COSMED. It trades about 0.04 of its potential returns per unit of risk. GLOBAL MED SA is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 59.00 in GLOBAL MED SA on November 3, 2024 and sell it today you would earn a total of 65.00 from holding GLOBAL MED SA or generate 110.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.8% |
| Values | Daily Returns |
Salesforce vs. GLOBAL MED SA
Performance |
| Timeline |
| Salesforce |
| GLOBAL MED SA |
Salesforce and GLOBAL COSMED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and GLOBAL COSMED
The main advantage of trading using opposite Salesforce and GLOBAL COSMED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, GLOBAL COSMED 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 GLOBAL COSMED will offset losses from the drop in GLOBAL COSMED's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| GLOBAL COSMED vs. Yanzhou Coal Mining | GLOBAL COSMED vs. GALENA MINING LTD | GLOBAL COSMED vs. MCEWEN MINING INC | GLOBAL COSMED vs. Singapore Airlines Limited |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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