Correlation Between Salesforce and Banco BTG
Can any of the company-specific risk be diversified away by investing in both Salesforce and Banco BTG 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 Banco BTG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Banco BTG Pactual, you can compare the effects of market volatilities on Salesforce and Banco BTG 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 Banco BTG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Banco BTG.
Diversification Opportunities for Salesforce and Banco BTG
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Salesforce and Banco is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Banco BTG Pactual in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banco BTG Pactual 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 Banco BTG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banco BTG Pactual has no effect on the direction of Salesforce i.e., Salesforce and Banco BTG go up and down completely randomly.
Pair Corralation between Salesforce and Banco BTG
Considering the 90-day investment horizon Salesforce is expected to generate 0.84 times more return on investment than Banco BTG. However, Salesforce is 1.2 times less risky than Banco BTG. It trades about 0.09 of its potential returns per unit of risk. Banco BTG Pactual is currently generating about 0.05 per unit of risk. If you would invest 16,830 in Salesforce on August 27, 2024 and sell it today you would earn a total of 17,372 from holding Salesforce or generate 103.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.78% |
| Values | Daily Returns |
Salesforce vs. Banco BTG Pactual
Performance |
| Timeline |
| Salesforce |
| Banco BTG Pactual |
Salesforce and Banco BTG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Banco BTG
The main advantage of trading using opposite Salesforce and Banco BTG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Banco BTG 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 Banco BTG will offset losses from the drop in Banco BTG'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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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