Salesforce Volatility

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CRM -- USA Stock  

Fiscal Quarter End: 31st of July 2020  

Salesforce appears to be very steady, given 3 months investment horizon. Salesforce Com owns Efficiency Ratio (i.e. Sharpe Ratio) of 0.18, which indicates the firm had 0.18% of return per unit of risk over the last 3 months. Our standpoint towards measuring the volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for Salesforce Com, which you can use to evaluate future volatility of the company. Please operate Salesforce coefficient of variation of 428.89, risk adjusted performance of 0.4263, and semi deviation of 2.24 to confirm if our risk estimates are consistent with your expectations.

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Salesforce Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Salesforce daily returns, and it is calculated using variance and standard deviation. We also use Salesforce's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Salesforce volatility.

  Salesforce Interest Expense

90 Days Market Risk

Very steady

Chance of Distress

Very Small

90 Days Economic Sensitivity

Almost neglects market trends

Salesforce Market Sensitivity And Downside Risk

Salesforce Com beta coefficient measures the volatility of Salesforce stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Salesforce stock's returns against your selected market. In other words, Salesforce's beta of -0.2479 provides an investor with an approximation of how much risk Salesforce stock can potentially add to one of your existing portfolios. Let's try to break down what Salesforce's beta means in this case. As returns on the market increase, returns on owning Salesforce are expected to decrease at a much lower rate. During the bear market, Salesforce is likely to outperform the market.
3 Months Beta |Analyze Salesforce Com Demand Trend
Check current 30 days Salesforce correlation with market (DOW)
β

Current Salesforce Beta Coefficient

 = 

Salesforce Central Daily Price Deviations

It is essential to understand the difference between upside risk (as represented by Salesforce's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Salesforce stock's daily returns or price. Since the actual investment returns on holding a position in Salesforce stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Salesforce.

Salesforce Com Volatility Analysis

Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Salesforce Com Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input. View also all equity analysis or get more info about average price price transform indicator.

Salesforce Projected Return Density Against Market

Considering the 30-days investment horizon, Salesforce Com has a beta of -0.2479 suggesting as returns on benchmark increase, returns on holding Salesforce are expected to decrease at a much lower rate. During the bear market, however, Salesforce Com is likely to outperform the market. Moreover, Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Salesforce or Artificial Intelligence sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Salesforce stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Salesforce stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision. The company has an alpha of 0.6598, implying that it can generate a 0.66 percent excess return over DOW after adjusting for the inherited market risk (beta).
 Predicted Return Density 
      Returns 

Salesforce Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Salesforce or Artificial Intelligence sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Salesforce stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Salesforce stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision. Considering the 30-days investment horizon, the coefficient of variation of Salesforce is 544.23. The daily returns are destributed with a variance of 5.96 and standard deviation of 2.44. The mean deviation of Salesforce Com is currently at 1.91. For similar time horizon, the selected benchmark (DOW) has volatility of 1.81
α
Alpha over DOW
=0.66
β
Beta against DOW=-0.25
σ
Overall volatility
=2.44
Ir
Information ratio =0.16

Salesforce Return Volatility

Salesforce historical daily return volatility represents how much Salesforce stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. The company has volatility of 2.441% on return distribution over 30 days investment horizon. By contrast, DOW inherits 1.8343% risk (volatility on return distribution) over the 30 days horizon.
 Performance (%) 
      Timeline 

About Salesforce Volatility

Volatility is a rate at which the price of Salesforce or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Salesforce may increase or decrease. In other words, similar to Salesforce's beta indicator, it measures the risk of Salesforce and helps estimate the fluctuations that may happen in a short period of time. So if prices of Salesforce fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility. Please read more on our technical analysis page.
Last ReportedProjected for 2020
Market Capitalization133.7 B144.3 B
salesforce.com, inc. develops enterprise cloud computing solutions with a focus on customer relationship management worldwide. The company was founded in 1999 and is headquartered in San Francisco, California. Salesforce operates under SoftwareApplication classification in the United States and is traded on BATS Exchange. It employs 51613 people.

Salesforce Investment Opportunity

Salesforce Com has a volatility of 2.44 and is 1.33 times more volatile than DOW. 21  of all equities and portfolios are less risky than Salesforce. Compared to the overall equity markets, volatility of historical daily returns of Salesforce Com is lower than 21 () of all global equities and portfolios over the last 30 days. Use Salesforce Com to enhance returns of your portfolios. The stock experiences a large bullish trend. Check odds of Salesforce to be traded at $220.31 in 30 days. . Let's try to break down what Salesforce's beta means in this case. As returns on the market increase, returns on owning Salesforce are expected to decrease at a much lower rate. During the bear market, Salesforce is likely to outperform the market.

Salesforce correlation with market

correlation synergy
Good diversification
Overlapping area represents the amount of risk that can be diversified away by holding Salesforce Com Inc and equity matching DJI index in the same portfolio.

Salesforce Additional Risk Indicators

The analysis of various secondary risk indicators of Salesforce is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Salesforce investment, and either accepting that risk or mitigating it. Along with some common measures of Salesforce stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging your existing portfolio. Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing the like to determine which investment holds the most risk.
Risk Adjusted Performance0.4263
Market Risk Adjusted Performance(2.47)
Mean Deviation2.02
Semi Deviation2.24
Downside Deviation2.89
Coefficient Of Variation428.89
Standard Deviation2.68

Salesforce Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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