Correlation Between Salesforce and JetBlue Airways
Can any of the company-specific risk be diversified away by investing in both Salesforce and JetBlue Airways 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 JetBlue Airways into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and JetBlue Airways Corp, you can compare the effects of market volatilities on Salesforce and JetBlue Airways 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 JetBlue Airways. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and JetBlue Airways.
Diversification Opportunities for Salesforce and JetBlue Airways
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Salesforce and JetBlue is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and JetBlue Airways Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JetBlue Airways Corp 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 JetBlue Airways. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JetBlue Airways Corp has no effect on the direction of Salesforce i.e., Salesforce and JetBlue Airways go up and down completely randomly.
Pair Corralation between Salesforce and JetBlue Airways
Considering the 90-day investment horizon Salesforce is expected to generate 0.54 times more return on investment than JetBlue Airways. However, Salesforce is 1.86 times less risky than JetBlue Airways. It trades about 0.21 of its potential returns per unit of risk. JetBlue Airways Corp is currently generating about 0.0 per unit of risk. If you would invest 29,889 in Salesforce on August 30, 2024 and sell it today you would earn a total of 3,112 from holding Salesforce or generate 10.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. JetBlue Airways Corp
Performance |
| Timeline |
| Salesforce |
| JetBlue Airways Corp |
Salesforce and JetBlue Airways Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and JetBlue Airways
The main advantage of trading using opposite Salesforce and JetBlue Airways positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, JetBlue Airways 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 JetBlue Airways will offset losses from the drop in JetBlue Airways' long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| JetBlue Airways vs. American Airlines Group | JetBlue Airways vs. Southwest Airlines | JetBlue Airways vs. Frontier Group Holdings |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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