Correlation Between Salesforce and Old National
Can any of the company-specific risk be diversified away by investing in both Salesforce and Old National 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 Old National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Old National Bancorp, you can compare the effects of market volatilities on Salesforce and Old National 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 Old National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Old National.
Diversification Opportunities for Salesforce and Old National
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Salesforce and Old is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Old National Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old National Bancorp 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 Old National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old National Bancorp has no effect on the direction of Salesforce i.e., Salesforce and Old National go up and down completely randomly.
Pair Corralation between Salesforce and Old National
Considering the 90-day investment horizon Salesforce is expected to generate 3.57 times more return on investment than Old National. However, Salesforce is 3.57 times more volatile than Old National Bancorp. It trades about 0.23 of its potential returns per unit of risk. Old National Bancorp is currently generating about 0.01 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 | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. Old National Bancorp
Performance |
| Timeline |
| Salesforce |
| Old National Bancorp |
Salesforce and Old National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Old National
The main advantage of trading using opposite Salesforce and Old National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Old National 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 Old National will offset losses from the drop in Old National's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| Old National vs. Old National Bancorp | Old National vs. Washington Federal | Old National vs. Heartland Financial USA | Old National vs. CNB Financial |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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