Correlation Between Salesforce and Petrolimex Petrochemical
Can any of the company-specific risk be diversified away by investing in both Salesforce and Petrolimex Petrochemical 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 Petrolimex Petrochemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Petrolimex Petrochemical JSC, you can compare the effects of market volatilities on Salesforce and Petrolimex Petrochemical 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 Petrolimex Petrochemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Petrolimex Petrochemical.
Diversification Opportunities for Salesforce and Petrolimex Petrochemical
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Salesforce and Petrolimex is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Petrolimex Petrochemical JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrolimex Petrochemical 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 Petrolimex Petrochemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrolimex Petrochemical has no effect on the direction of Salesforce i.e., Salesforce and Petrolimex Petrochemical go up and down completely randomly.
Pair Corralation between Salesforce and Petrolimex Petrochemical
Considering the 90-day investment horizon Salesforce is expected to generate 1.11 times more return on investment than Petrolimex Petrochemical. However, Salesforce is 1.11 times more volatile than Petrolimex Petrochemical JSC. It trades about 0.22 of its potential returns per unit of risk. Petrolimex Petrochemical JSC is currently generating about -0.24 per unit of risk. If you would invest 28,091 in Salesforce on September 3, 2024 and sell it today you would earn a total of 4,908 from holding Salesforce or generate 17.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. Petrolimex Petrochemical JSC
Performance |
| Timeline |
| Salesforce |
| Petrolimex Petrochemical |
Salesforce and Petrolimex Petrochemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Petrolimex Petrochemical
The main advantage of trading using opposite Salesforce and Petrolimex Petrochemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Petrolimex Petrochemical 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 Petrolimex Petrochemical will offset losses from the drop in Petrolimex Petrochemical's 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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