Correlation Between Macquarie Group and Salesforce
Can any of the company-specific risk be diversified away by investing in both Macquarie Group 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 Macquarie Group and Salesforce into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macquarie Group Ltd and Salesforce, you can compare the effects of market volatilities on Macquarie Group 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 Macquarie Group with a short position of Salesforce. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquarie Group and Salesforce.
Diversification Opportunities for Macquarie Group and Salesforce
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Macquarie and Salesforce is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Macquarie Group Ltd and Salesforce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salesforce and Macquarie Group 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 Macquarie Group Ltd 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 Macquarie Group i.e., Macquarie Group and Salesforce go up and down completely randomly.
Pair Corralation between Macquarie Group and Salesforce
Assuming the 90 days horizon Macquarie Group is expected to generate 110.82 times less return on investment than Salesforce. But when comparing it to its historical volatility, Macquarie Group Ltd is 1.23 times less risky than Salesforce. It trades about 0.0 of its potential returns per unit of risk. Salesforce is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 17,208 in Salesforce on January 25, 2024 and sell it today you would earn a total of 10,485 from holding Salesforce or generate 60.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macquarie Group Ltd vs. Salesforce
Performance |
| Timeline |
| Macquarie Group |
| Salesforce |
Macquarie Group and Salesforce Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquarie Group and Salesforce
The main advantage of trading using opposite Macquarie Group and Salesforce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquarie Group 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.| Macquarie Group vs. Evercore Partners | Macquarie Group vs. PJT Partners | Macquarie Group vs. Lazard | Macquarie Group vs. Perella Weinberg Partners |
| Salesforce vs. Clearwater Analytics Holdings | Salesforce vs. Meridianlink | Salesforce vs. Envestnet | Salesforce vs. Model N |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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