Correlation Between Salesforce and Xinyi Glass
Can any of the company-specific risk be diversified away by investing in both Salesforce and Xinyi Glass 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 Xinyi Glass into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Xinyi Glass Holdings, you can compare the effects of market volatilities on Salesforce and Xinyi Glass 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 Xinyi Glass. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Xinyi Glass.
Diversification Opportunities for Salesforce and Xinyi Glass
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Salesforce and Xinyi is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Xinyi Glass Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinyi Glass Holdings 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 Xinyi Glass. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinyi Glass Holdings has no effect on the direction of Salesforce i.e., Salesforce and Xinyi Glass go up and down completely randomly.
Pair Corralation between Salesforce and Xinyi Glass
Considering the 90-day investment horizon Salesforce is expected to generate 0.7 times more return on investment than Xinyi Glass. However, Salesforce is 1.44 times less risky than Xinyi Glass. It trades about 0.1 of its potential returns per unit of risk. Xinyi Glass Holdings is currently generating about 0.01 per unit of risk. If you would invest 33,053 in Salesforce on November 5, 2024 and sell it today you would earn a total of 1,117 from holding Salesforce or generate 3.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Salesforce vs. Xinyi Glass Holdings
Performance |
| Timeline |
| Salesforce |
| Xinyi Glass Holdings |
Salesforce and Xinyi Glass Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Xinyi Glass
The main advantage of trading using opposite Salesforce and Xinyi Glass positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Xinyi Glass 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 Xinyi Glass will offset losses from the drop in Xinyi Glass' long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| Xinyi Glass vs. Xinyi Glass Holdings | Xinyi Glass vs. CEMATRIX | Xinyi Glass vs. Anhui Conch Cement | Xinyi Glass vs. Basanite |
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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