Correlation Between Salesforce and Bitcoin Depot
Can any of the company-specific risk be diversified away by investing in both Salesforce and Bitcoin Depot 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 Bitcoin Depot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Bitcoin Depot, you can compare the effects of market volatilities on Salesforce and Bitcoin Depot 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 Bitcoin Depot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Bitcoin Depot.
Diversification Opportunities for Salesforce and Bitcoin Depot
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Salesforce and Bitcoin is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Bitcoin Depot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bitcoin Depot 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 Bitcoin Depot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bitcoin Depot has no effect on the direction of Salesforce i.e., Salesforce and Bitcoin Depot go up and down completely randomly.
Pair Corralation between Salesforce and Bitcoin Depot
Considering the 90-day investment horizon Salesforce is expected to generate 3.13 times less return on investment than Bitcoin Depot. But when comparing it to its historical volatility, Salesforce is 6.32 times less risky than Bitcoin Depot. It trades about 0.34 of its potential returns per unit of risk. Bitcoin Depot is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 144.00 in Bitcoin Depot on August 28, 2024 and sell it today you would earn a total of 54.00 from holding Bitcoin Depot or generate 37.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. Bitcoin Depot
Performance |
| Timeline |
| Salesforce |
| Bitcoin Depot |
Salesforce and Bitcoin Depot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Bitcoin Depot
The main advantage of trading using opposite Salesforce and Bitcoin Depot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Bitcoin Depot 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 Bitcoin Depot will offset losses from the drop in Bitcoin Depot's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| Bitcoin Depot vs. European Wax Center | Bitcoin Depot vs. Evolution Mining | Bitcoin Depot vs. NioCorp Developments Ltd | Bitcoin Depot vs. Estee Lauder Companies |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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