Correlation Between Salesforce and Computer Task
Can any of the company-specific risk be diversified away by investing in both Salesforce and Computer Task 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 Computer Task into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Computer Task Group, you can compare the effects of market volatilities on Salesforce and Computer Task 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 Computer Task. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Computer Task.
Diversification Opportunities for Salesforce and Computer Task
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Salesforce and Computer is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Computer Task Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Task Group 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 Computer Task. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Task Group has no effect on the direction of Salesforce i.e., Salesforce and Computer Task go up and down completely randomly.
Pair Corralation between Salesforce and Computer Task
Considering the 90-day investment horizon Salesforce is expected to generate 0.95 times more return on investment than Computer Task. However, Salesforce is 1.05 times less risky than Computer Task. It trades about 0.05 of its potential returns per unit of risk. Computer Task Group is currently generating about 0.03 per unit of risk. If you would invest 16,948 in Salesforce on January 26, 2024 and sell it today you would earn a total of 10,671 from holding Salesforce or generate 62.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.98% |
| Values | Daily Returns |
Salesforce vs. Computer Task Group
Performance |
| Timeline |
| Salesforce |
| Computer Task Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Salesforce and Computer Task Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Computer Task
The main advantage of trading using opposite Salesforce and Computer Task positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Computer Task 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 Computer Task will offset losses from the drop in Computer Task's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| Computer Task vs. The Hackett Group | Computer Task vs. CSP Inc | Computer Task vs. Clarivate Plc | Computer Task vs. Nayax |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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