Correlation Between Salesforce and Lesaka Technologies
Can any of the company-specific risk be diversified away by investing in both Salesforce and Lesaka Technologies 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 Lesaka Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Lesaka Technologies, you can compare the effects of market volatilities on Salesforce and Lesaka Technologies 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 Lesaka Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Lesaka Technologies.
Diversification Opportunities for Salesforce and Lesaka Technologies
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Salesforce and Lesaka is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Lesaka Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lesaka Technologies 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 Lesaka Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lesaka Technologies has no effect on the direction of Salesforce i.e., Salesforce and Lesaka Technologies go up and down completely randomly.
Pair Corralation between Salesforce and Lesaka Technologies
Considering the 90-day investment horizon Salesforce is expected to generate 0.69 times more return on investment than Lesaka Technologies. However, Salesforce is 1.45 times less risky than Lesaka Technologies. It trades about 0.41 of its potential returns per unit of risk. Lesaka Technologies is currently generating about 0.06 per unit of risk. If you would invest 28,676 in Salesforce on August 25, 2024 and sell it today you would earn a total of 5,526 from holding Salesforce or generate 19.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. Lesaka Technologies
Performance |
| Timeline |
| Salesforce |
| Lesaka Technologies |
Salesforce and Lesaka Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Lesaka Technologies
The main advantage of trading using opposite Salesforce and Lesaka Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Lesaka Technologies 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 Lesaka Technologies will offset losses from the drop in Lesaka Technologies' long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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