Correlation Between Salesforce and Accor S
Can any of the company-specific risk be diversified away by investing in both Salesforce and Accor S 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 Accor S into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Accor S A, you can compare the effects of market volatilities on Salesforce and Accor S 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 Accor S. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Accor S.
Diversification Opportunities for Salesforce and Accor S
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Salesforce and Accor is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Accor S A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accor S A 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 Accor S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accor S A has no effect on the direction of Salesforce i.e., Salesforce and Accor S go up and down completely randomly.
Pair Corralation between Salesforce and Accor S
Considering the 90-day investment horizon Salesforce is expected to generate 1.6 times more return on investment than Accor S. However, Salesforce is 1.6 times more volatile than Accor S A. It trades about 0.28 of its potential returns per unit of risk. Accor S A is currently generating about 0.15 per unit of risk. If you would invest 29,137 in Salesforce on September 1, 2024 and sell it today you would earn a total of 3,862 from holding Salesforce or generate 13.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 91.3% |
| Values | Daily Returns |
Salesforce vs. Accor S A
Performance |
| Timeline |
| Salesforce |
| Accor S A |
Salesforce and Accor S Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Accor S
The main advantage of trading using opposite Salesforce and Accor S positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Accor S 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 Accor S will offset losses from the drop in Accor S's long position.| Salesforce vs. Ke Holdings | Salesforce vs. nCino Inc | Salesforce vs. Kingsoft Cloud Holdings | Salesforce vs. Jfrog |
| Accor S vs. Les Hotels Bav | Accor S vs. Groupe Partouche SA | Accor S vs. Centrale dAchat Franaise | Accor S vs. Manitou BF SA |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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