Correlation Between Salesforce and AGFA Gevaert
Can any of the company-specific risk be diversified away by investing in both Salesforce and AGFA Gevaert 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 AGFA Gevaert into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and AGFA Gevaert NV, you can compare the effects of market volatilities on Salesforce and AGFA Gevaert 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 AGFA Gevaert. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and AGFA Gevaert.
Diversification Opportunities for Salesforce and AGFA Gevaert
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Salesforce and AGFA is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and AGFA Gevaert NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AGFA Gevaert NV 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 AGFA Gevaert. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AGFA Gevaert NV has no effect on the direction of Salesforce i.e., Salesforce and AGFA Gevaert go up and down completely randomly.
Pair Corralation between Salesforce and AGFA Gevaert
Considering the 90-day investment horizon Salesforce is expected to generate 0.39 times more return on investment than AGFA Gevaert. However, Salesforce is 2.54 times less risky than AGFA Gevaert. It trades about 0.28 of its potential returns per unit of risk. AGFA Gevaert NV 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 Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Salesforce vs. AGFA Gevaert NV
Performance |
| Timeline |
| Salesforce |
| AGFA Gevaert NV |
Salesforce and AGFA Gevaert Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and AGFA Gevaert
The main advantage of trading using opposite Salesforce and AGFA Gevaert positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, AGFA Gevaert 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 AGFA Gevaert will offset losses from the drop in AGFA Gevaert's long position.| Salesforce vs. Ke Holdings | Salesforce vs. nCino Inc | Salesforce vs. Kingsoft Cloud Holdings | Salesforce vs. Jfrog |
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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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