Correlation Between Salesforce and Elbit Imaging
Can any of the company-specific risk be diversified away by investing in both Salesforce and Elbit Imaging 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 Elbit Imaging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Elbit Imaging, you can compare the effects of market volatilities on Salesforce and Elbit Imaging 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 Elbit Imaging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Elbit Imaging.
Diversification Opportunities for Salesforce and Elbit Imaging
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Salesforce and Elbit is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Elbit Imaging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elbit Imaging 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 Elbit Imaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elbit Imaging has no effect on the direction of Salesforce i.e., Salesforce and Elbit Imaging go up and down completely randomly.
Pair Corralation between Salesforce and Elbit Imaging
Considering the 90-day investment horizon Salesforce is expected to generate 0.46 times more return on investment than Elbit Imaging. However, Salesforce is 2.15 times less risky than Elbit Imaging. It trades about 0.09 of its potential returns per unit of risk. Elbit Imaging is currently generating about -0.04 per unit of risk. If you would invest 19,467 in Salesforce on January 17, 2024 and sell it today you would earn a total of 7,823 from holding Salesforce or generate 40.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 80.89% |
| Values | Daily Returns |
Salesforce vs. Elbit Imaging
Performance |
| Timeline |
| Salesforce |
| Elbit Imaging |
Salesforce and Elbit Imaging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Elbit Imaging
The main advantage of trading using opposite Salesforce and Elbit Imaging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Elbit Imaging 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 Elbit Imaging will offset losses from the drop in Elbit Imaging's long position.The idea behind Salesforce and Elbit Imaging 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.| Elbit Imaging vs. B Communications | Elbit Imaging vs. Rapac Communication Infrastructure | Elbit Imaging vs. Allot Communications | Elbit Imaging vs. Suny Cellular Communication |
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.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |