Correlation Between Salesforce and Compugen
Can any of the company-specific risk be diversified away by investing in both Salesforce and Compugen 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 Compugen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Compugen, you can compare the effects of market volatilities on Salesforce and Compugen 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 Compugen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Compugen.
Diversification Opportunities for Salesforce and Compugen
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Salesforce and Compugen is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Compugen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compugen 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 Compugen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compugen has no effect on the direction of Salesforce i.e., Salesforce and Compugen go up and down completely randomly.
Pair Corralation between Salesforce and Compugen
Considering the 90-day investment horizon Salesforce is expected to generate 0.7 times more return on investment than Compugen. However, Salesforce is 1.43 times less risky than Compugen. It trades about 0.35 of its potential returns per unit of risk. Compugen is currently generating about -0.38 per unit of risk. If you would invest 29,377 in Salesforce on August 29, 2024 and sell it today you would earn a total of 4,941 from holding Salesforce or generate 16.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 82.61% |
| Values | Daily Returns |
Salesforce vs. Compugen
Performance |
| Timeline |
| Salesforce |
| Compugen |
Salesforce and Compugen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Compugen
The main advantage of trading using opposite Salesforce and Compugen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Compugen 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 Compugen will offset losses from the drop in Compugen's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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