Correlation Between Salesforce and Franklin Bitcoin
Can any of the company-specific risk be diversified away by investing in both Salesforce and Franklin Bitcoin 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 Franklin Bitcoin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Franklin Bitcoin ETF, you can compare the effects of market volatilities on Salesforce and Franklin Bitcoin 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 Franklin Bitcoin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Franklin Bitcoin.
Diversification Opportunities for Salesforce and Franklin Bitcoin
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Salesforce and Franklin is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Franklin Bitcoin ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Bitcoin ETF 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 Franklin Bitcoin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Bitcoin ETF has no effect on the direction of Salesforce i.e., Salesforce and Franklin Bitcoin go up and down completely randomly.
Pair Corralation between Salesforce and Franklin Bitcoin
Considering the 90-day investment horizon Salesforce is expected to generate 2.69 times less return on investment than Franklin Bitcoin. But when comparing it to its historical volatility, Salesforce is 1.92 times less risky than Franklin Bitcoin. It trades about 0.28 of its potential returns per unit of risk. Franklin Bitcoin ETF is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 4,052 in Franklin Bitcoin ETF on September 1, 2024 and sell it today you would earn a total of 1,580 from holding Franklin Bitcoin ETF or generate 38.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. Franklin Bitcoin ETF
Performance |
| Timeline |
| Salesforce |
| Franklin Bitcoin ETF |
Salesforce and Franklin Bitcoin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Franklin Bitcoin
The main advantage of trading using opposite Salesforce and Franklin Bitcoin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Franklin Bitcoin 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 Franklin Bitcoin will offset losses from the drop in Franklin Bitcoin'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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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