Correlation Between Salesforce and Thai Rung
Can any of the company-specific risk be diversified away by investing in both Salesforce and Thai Rung 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 Thai Rung into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Thai Rung Union, you can compare the effects of market volatilities on Salesforce and Thai Rung 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 Thai Rung. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Thai Rung.
Diversification Opportunities for Salesforce and Thai Rung
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Salesforce and Thai is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Thai Rung Union in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Rung Union 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 Thai Rung. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Rung Union has no effect on the direction of Salesforce i.e., Salesforce and Thai Rung go up and down completely randomly.
Pair Corralation between Salesforce and Thai Rung
Considering the 90-day investment horizon Salesforce is expected to generate 66.12 times less return on investment than Thai Rung. But when comparing it to its historical volatility, Salesforce is 33.53 times less risky than Thai Rung. It trades about 0.04 of its potential returns per unit of risk. Thai Rung Union is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 325.00 in Thai Rung Union on September 3, 2024 and sell it today you would lose (7.00) from holding Thai Rung Union or give up 2.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.18% |
| Values | Daily Returns |
Salesforce vs. Thai Rung Union
Performance |
| Timeline |
| Salesforce |
| Thai Rung Union |
Salesforce and Thai Rung Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Thai Rung
The main advantage of trading using opposite Salesforce and Thai Rung positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Thai Rung 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 Thai Rung will offset losses from the drop in Thai Rung'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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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