Correlation Between Salesforce and IRobot
Can any of the company-specific risk be diversified away by investing in both Salesforce and IRobot 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 IRobot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and iRobot, you can compare the effects of market volatilities on Salesforce and IRobot 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 IRobot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and IRobot.
Diversification Opportunities for Salesforce and IRobot
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Salesforce and IRobot is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and iRobot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iRobot 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 IRobot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iRobot has no effect on the direction of Salesforce i.e., Salesforce and IRobot go up and down completely randomly.
Pair Corralation between Salesforce and IRobot
Considering the 90-day investment horizon Salesforce is expected to generate 0.24 times more return on investment than IRobot. However, Salesforce is 4.22 times less risky than IRobot. It trades about 0.23 of its potential returns per unit of risk. iRobot is currently generating about -0.04 per unit of risk. If you would invest 29,640 in Salesforce on August 31, 2024 and sell it today you would earn a total of 3,361 from holding Salesforce or generate 11.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. iRobot
Performance |
| Timeline |
| Salesforce |
| iRobot |
Salesforce and IRobot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and IRobot
The main advantage of trading using opposite Salesforce and IRobot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, IRobot 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 IRobot will offset losses from the drop in IRobot's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| IRobot vs. Tempur Sealy International | IRobot vs. La Z Boy Incorporated | IRobot vs. Purple Innovation | IRobot vs. MasterBrand |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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