Correlation Between Winpak and Salesforce
Can any of the company-specific risk be diversified away by investing in both Winpak 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 Winpak and Salesforce into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Winpak and SalesforceCom CDR, you can compare the effects of market volatilities on Winpak 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 Winpak with a short position of Salesforce. Check out your portfolio center. Please also check ongoing floating volatility patterns of Winpak and Salesforce.
Diversification Opportunities for Winpak and Salesforce
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Winpak and Salesforce is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Winpak and SalesforceCom CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SalesforceCom CDR and Winpak 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 Winpak 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 SalesforceCom CDR has no effect on the direction of Winpak i.e., Winpak and Salesforce go up and down completely randomly.
Pair Corralation between Winpak and Salesforce
Assuming the 90 days trading horizon Winpak is expected to generate 3.48 times less return on investment than Salesforce. But when comparing it to its historical volatility, Winpak is 1.58 times less risky than Salesforce. It trades about 0.02 of its potential returns per unit of risk. SalesforceCom CDR is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,316 in SalesforceCom CDR on November 3, 2024 and sell it today you would earn a total of 393.00 from holding SalesforceCom CDR or generate 16.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Winpak vs. SalesforceCom CDR
Performance |
| Timeline |
| Winpak |
| SalesforceCom CDR |
Winpak and Salesforce Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Winpak and Salesforce
The main advantage of trading using opposite Winpak and Salesforce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Winpak 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.| Winpak vs. Constellation Software | Winpak vs. Fairfax Financial Holdings | Winpak vs. Pollard Banknote Limited | Winpak vs. Laurentian Bank |
| Salesforce vs. US Financial 15 | Salesforce vs. Royal Bank of | Salesforce vs. CI Financial Corp | Salesforce vs. First National Financial |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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