Correlation Between Salesforce and Jerónimo Martins
Can any of the company-specific risk be diversified away by investing in both Salesforce and Jerónimo Martins 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 Jerónimo Martins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Jernimo Martins SGPS, you can compare the effects of market volatilities on Salesforce and Jerónimo Martins 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 Jerónimo Martins. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Jerónimo Martins.
Diversification Opportunities for Salesforce and Jerónimo Martins
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Salesforce and Jerónimo is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Jernimo Martins SGPS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jernimo Martins SGPS 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 Jerónimo Martins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jernimo Martins SGPS has no effect on the direction of Salesforce i.e., Salesforce and Jerónimo Martins go up and down completely randomly.
Pair Corralation between Salesforce and Jerónimo Martins
Considering the 90-day investment horizon Salesforce is expected to generate 1.98 times less return on investment than Jerónimo Martins. In addition to that, Salesforce is 1.3 times more volatile than Jernimo Martins SGPS. It trades about 0.05 of its total potential returns per unit of risk. Jernimo Martins SGPS is currently generating about 0.13 per unit of volatility. If you would invest 1,848 in Jernimo Martins SGPS on November 8, 2024 and sell it today you would earn a total of 86.00 from holding Jernimo Martins SGPS or generate 4.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
Salesforce vs. Jernimo Martins SGPS
Performance |
| Timeline |
| Salesforce |
| Jernimo Martins SGPS |
Salesforce and Jerónimo Martins Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Jerónimo Martins
The main advantage of trading using opposite Salesforce and Jerónimo Martins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Jerónimo Martins 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 Jerónimo Martins will offset losses from the drop in Jerónimo Martins' long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| Jerónimo Martins vs. Nanjing Panda Electronics | Jerónimo Martins vs. KIMBALL ELECTRONICS | Jerónimo Martins vs. Meiko Electronics Co | Jerónimo Martins vs. Tsingtao Brewery |
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.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |