Correlation Between Salesforce and Jupiter Fund

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

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

Diversification Opportunities for Salesforce and Jupiter Fund

0.55

Correlation Coefficient

Salesforce  Jupiter Fund

Very weak diversification

The 3 months correlation between Salesforce and Jupiter is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Jupiter Fund Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupiter Fund Management 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 Jupiter Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupiter Fund Management has no effect on the direction of Salesforce i.e., Salesforce and Jupiter Fund go up and down completely randomly.

Pair Corralation between Salesforce and Jupiter Fund

Considering the 90-day investment horizon Salesforce is expected to generate 1.05 times more return on investment than Jupiter Fund. However, Salesforce is 1.05 times more volatile than Jupiter Fund Management. It trades about 0.22 of its potential returns per unit of risk. Jupiter Fund Management is currently generating about -0.17 per unit of risk. If you would invest  23,662  in Salesforce on April 4, 2024 and sell it today you would earn a total of  1,957  from holding Salesforce or generate 8.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	91.3%
Values	Daily Returns

Salesforce  vs.  Jupiter Fund Management

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 latest inconsistent performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Jupiter Fund Management

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jupiter Fund Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's essential indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Salesforce and Jupiter Fund

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

The idea behind Salesforce and Jupiter Fund Management 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.

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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 Commodity Directory module to find actively traded commodities issued by global exchanges.