Correlation Between SK Telecom and Salesforce
Can any of the company-specific risk be diversified away by investing in both SK Telecom 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 SK Telecom and Salesforce into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Telecom Co, and salesforce inc, you can compare the effects of market volatilities on SK Telecom 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 SK Telecom with a short position of Salesforce. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Telecom and Salesforce.
Diversification Opportunities for SK Telecom and Salesforce
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between S1KM34 and Salesforce is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding SK Telecom Co, and salesforce inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on salesforce inc and SK Telecom 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 SK Telecom Co, 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 inc has no effect on the direction of SK Telecom i.e., SK Telecom and Salesforce go up and down completely randomly.
Pair Corralation between SK Telecom and Salesforce
Assuming the 90 days trading horizon SK Telecom is expected to generate 2.15 times less return on investment than Salesforce. But when comparing it to its historical volatility, SK Telecom Co, is 1.36 times less risky than Salesforce. It trades about 0.04 of its potential returns per unit of risk. salesforce inc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 4,430 in salesforce inc on December 11, 2024 and sell it today you would earn a total of 2,876 from holding salesforce inc or generate 64.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Telecom Co, vs. salesforce inc
Performance |
| Timeline |
| SK Telecom Co, |
| salesforce inc |
SK Telecom and Salesforce Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Telecom and Salesforce
The main advantage of trading using opposite SK Telecom and Salesforce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Telecom 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.| SK Telecom vs. METISA Metalrgica Timboense | ||
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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