Correlation Between Salesforce and Eguana Technologies
Can any of the company-specific risk be diversified away by investing in both Salesforce and Eguana Technologies 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 Eguana Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Eguana Technologies, you can compare the effects of market volatilities on Salesforce and Eguana Technologies 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 Eguana Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Eguana Technologies.
Diversification Opportunities for Salesforce and Eguana Technologies
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Salesforce and Eguana is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Eguana Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eguana Technologies 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 Eguana Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eguana Technologies has no effect on the direction of Salesforce i.e., Salesforce and Eguana Technologies go up and down completely randomly.
Pair Corralation between Salesforce and Eguana Technologies
Considering the 90-day investment horizon Salesforce is expected to generate 0.36 times more return on investment than Eguana Technologies. However, Salesforce is 2.77 times less risky than Eguana Technologies. It trades about -0.22 of its potential returns per unit of risk. Eguana Technologies is currently generating about -0.22 per unit of risk. If you would invest 30,051 in Salesforce on January 17, 2024 and sell it today you would lose (2,761) from holding Salesforce or give up 9.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. Eguana Technologies
Performance |
| Timeline |
| Salesforce |
| Eguana Technologies |
Salesforce and Eguana Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Eguana Technologies
The main advantage of trading using opposite Salesforce and Eguana Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Eguana Technologies 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 Eguana Technologies will offset losses from the drop in Eguana Technologies' long position.The idea behind Salesforce and Eguana Technologies 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.| Eguana Technologies vs. Microsoft Corp CDR | Eguana Technologies vs. Apple Inc CDR | Eguana Technologies vs. NVIDIA CDR | Eguana Technologies vs. Alphabet Inc CDR |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |