Correlation Between Salesforce and Aurora Acquisition
Can any of the company-specific risk be diversified away by investing in both Salesforce and Aurora Acquisition 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 Aurora Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Aurora Acquisition Corp, you can compare the effects of market volatilities on Salesforce and Aurora Acquisition 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 Aurora Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Aurora Acquisition.
Diversification Opportunities for Salesforce and Aurora Acquisition
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Salesforce and Aurora is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Aurora Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Acquisition Corp 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 Aurora Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Acquisition Corp has no effect on the direction of Salesforce i.e., Salesforce and Aurora Acquisition go up and down completely randomly.
Pair Corralation between Salesforce and Aurora Acquisition
Considering the 90-day investment horizon Salesforce is expected to generate 2.62 times more return on investment than Aurora Acquisition. However, Salesforce is 2.62 times more volatile than Aurora Acquisition Corp. It trades about 0.1 of its potential returns per unit of risk. Aurora Acquisition Corp is currently generating about 0.07 per unit of risk. If you would invest 13,502 in Salesforce on September 3, 2024 and sell it today you would earn a total of 19,599 from holding Salesforce or generate 145.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 30.71% |
| Values | Daily Returns |
Salesforce vs. Aurora Acquisition Corp
Performance |
| Timeline |
| Salesforce |
| Aurora Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Salesforce and Aurora Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Aurora Acquisition
The main advantage of trading using opposite Salesforce and Aurora Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Aurora Acquisition 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 Aurora Acquisition will offset losses from the drop in Aurora Acquisition'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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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