Correlation Between Salesforce and Actoz Soft

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

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

Diversification Opportunities for Salesforce and Actoz Soft

0.06

Correlation Coefficient

Salesforce  Actoz Soft

Significant diversification

The 3 months correlation between Salesforce and Actoz is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Actoz Soft CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Actoz Soft CoLtd 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 Actoz Soft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Actoz Soft CoLtd has no effect on the direction of Salesforce i.e., Salesforce and Actoz Soft go up and down completely randomly.

Pair Corralation between Salesforce and Actoz Soft

Considering the 90-day investment horizon Salesforce is expected to under-perform the Actoz Soft. But the stock apears to be less risky and, when comparing its historical volatility, Salesforce is 1.3 times less risky than Actoz Soft. The stock trades about -0.18 of its potential returns per unit of risk. The Actoz Soft CoLtd is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  701,000  in Actoz Soft CoLtd on December 23, 2024 and sell it today you would lose (58,000) from holding Actoz Soft CoLtd or give up 8.27% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.08%
Values	Daily Returns

Salesforce  vs.  Actoz Soft CoLtd

Salesforce

Risk-Adjusted Performance

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 unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Actoz Soft CoLtd

Risk-Adjusted Performance

Very Weak

Over the last 90 days Actoz Soft CoLtd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Salesforce and Actoz Soft

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

The idea behind Salesforce and Actoz Soft CoLtd 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.