Correlation Between Esker SA and Salesforce
Can any of the company-specific risk be diversified away by investing in both Esker SA and Salesforce 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 Esker SA and Salesforce into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esker SA and Salesforce, you can compare the effects of market volatilities on Esker SA and Salesforce 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 Esker SA with a short position of Salesforce. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esker SA and Salesforce.
Diversification Opportunities for Esker SA and Salesforce
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Esker and Salesforce is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Esker SA and Salesforce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salesforce and Esker SA 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 Esker SA are associated (or correlated) with Salesforce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salesforce has no effect on the direction of Esker SA i.e., Esker SA and Salesforce go up and down completely randomly.
Pair Corralation between Esker SA and Salesforce
Assuming the 90 days horizon Esker SA is expected to generate 2.03 times less return on investment than Salesforce. In addition to that, Esker SA is 1.07 times more volatile than Salesforce. It trades about 0.12 of its total potential returns per unit of risk. Salesforce is currently generating about 0.26 per unit of volatility. If you would invest 25,849 in Salesforce on August 28, 2024 and sell it today you would earn a total of 8,062 from holding Salesforce or generate 31.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Esker SA vs. Salesforce
Performance |
| Timeline |
| Esker SA |
| Salesforce |
Esker SA and Salesforce Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esker SA and Salesforce
The main advantage of trading using opposite Esker SA and Salesforce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esker SA position performs unexpectedly, Salesforce 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 Salesforce will offset losses from the drop in Salesforce's long position.The idea behind Esker SA and Salesforce pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |