Correlation Between Salesforce and Hecla Mining

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

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

Diversification Opportunities for Salesforce and Hecla Mining

-0.14

Correlation Coefficient

Salesforce  Hecla Mining

Good diversification

The 3 months correlation between Salesforce and Hecla is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Hecla Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hecla Mining 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 Hecla Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hecla Mining has no effect on the direction of Salesforce i.e., Salesforce and Hecla Mining go up and down completely randomly.

Pair Corralation between Salesforce and Hecla Mining

Considering the 90-day investment horizon Salesforce is expected to under-perform the Hecla Mining. But the stock apears to be less risky and, when comparing its historical volatility, Salesforce is 1.82 times less risky than Hecla Mining. The stock trades about -0.18 of its potential returns per unit of risk. The Hecla Mining Co is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  508.00  in Hecla Mining Co on December 22, 2024 and sell it today you would earn a total of  66.00  from holding Hecla Mining Co or generate 12.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Salesforce  vs.  Hecla Mining Co

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.

Hecla Mining

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Hecla Mining Co are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Hecla Mining unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Salesforce and Hecla Mining

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

The idea behind Salesforce and Hecla Mining Co 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.