Correlation Between Salesforce and Loomis Sayles

Can any of the company-specific risk be diversified away by investing in both Salesforce and Loomis Sayles 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 Loomis Sayles into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Salesforce and Loomis Sayles Limited, you can compare the effects of market volatilities on Salesforce and Loomis Sayles 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 Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Loomis Sayles.

Diversification Opportunities for Salesforce and Loomis Sayles

0.0

Correlation Coefficient

Salesforce  Loomis Sayles

Pay attention - limited upside

The 3 months correlation between Salesforce and Loomis is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Loomis Sayles Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Limited 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 Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Limited has no effect on the direction of Salesforce i.e., Salesforce and Loomis Sayles go up and down completely randomly.

Pair Corralation between Salesforce and Loomis Sayles

If you would invest (100.00) in Loomis Sayles Limited on March 11, 2024 and sell it today you would earn a total of  100.00  from holding Loomis Sayles Limited or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Salesforce  vs.  Loomis Sayles Limited

Salesforce

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Salesforce has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in July 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Loomis Sayles Limited

Risk-Adjusted Performance

0 of 100

Insignificant

Over the last 90 days Loomis Sayles Limited has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Loomis Sayles is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Salesforce and Loomis Sayles

The main advantage of trading using opposite Salesforce and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.

The idea behind Salesforce and Loomis Sayles Limited 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.

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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.