Correlation Between Salesforce and Life Insurance
Can any of the company-specific risk be diversified away by investing in both Salesforce and Life Insurance 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 Life Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Life Insurance, you can compare the effects of market volatilities on Salesforce and Life Insurance 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 Life Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Life Insurance.
Diversification Opportunities for Salesforce and Life Insurance
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Salesforce and Life is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life Insurance 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 Life Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Life Insurance has no effect on the direction of Salesforce i.e., Salesforce and Life Insurance go up and down completely randomly.
Pair Corralation between Salesforce and Life Insurance
Considering the 90-day investment horizon Salesforce is expected to generate 0.98 times more return on investment than Life Insurance. However, Salesforce is 1.02 times less risky than Life Insurance. It trades about 0.22 of its potential returns per unit of risk. Life Insurance is currently generating about -0.24 per unit of risk. If you would invest 33,066 in Salesforce on November 2, 2024 and sell it today you would earn a total of 2,334 from holding Salesforce or generate 7.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
Salesforce vs. Life Insurance
Performance |
| Timeline |
| Salesforce |
| Life Insurance |
Salesforce and Life Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Life Insurance
The main advantage of trading using opposite Salesforce and Life Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Life Insurance 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 Life Insurance will offset losses from the drop in Life Insurance's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| Life Insurance vs. Silly Monks Entertainment | Life Insurance vs. Welspun Investments and | Life Insurance vs. Touchwood Entertainment Limited | Life Insurance vs. Bodhi Tree Multimedia |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |