Correlation Between Salesforce and Truong Thanh
Can any of the company-specific risk be diversified away by investing in both Salesforce and Truong Thanh 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 Truong Thanh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Truong Thanh Furniture, you can compare the effects of market volatilities on Salesforce and Truong Thanh 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 Truong Thanh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Truong Thanh.
Diversification Opportunities for Salesforce and Truong Thanh
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Salesforce and Truong is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Truong Thanh Furniture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Truong Thanh Furniture 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 Truong Thanh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Truong Thanh Furniture has no effect on the direction of Salesforce i.e., Salesforce and Truong Thanh go up and down completely randomly.
Pair Corralation between Salesforce and Truong Thanh
Considering the 90-day investment horizon Salesforce is expected to generate 1.19 times more return on investment than Truong Thanh. However, Salesforce is 1.19 times more volatile than Truong Thanh Furniture. It trades about -0.02 of its potential returns per unit of risk. Truong Thanh Furniture is currently generating about -0.3 per unit of risk. If you would invest 33,574 in Salesforce on October 29, 2024 and sell it today you would lose (186.00) from holding Salesforce or give up 0.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Salesforce vs. Truong Thanh Furniture
Performance |
| Timeline |
| Salesforce |
| Truong Thanh Furniture |
Salesforce and Truong Thanh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Truong Thanh
The main advantage of trading using opposite Salesforce and Truong Thanh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Truong Thanh 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 Truong Thanh will offset losses from the drop in Truong Thanh'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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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