Correlation Between Salesforce and Acticor Biotech

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

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

Diversification Opportunities for Salesforce and Acticor Biotech

-0.05

Correlation Coefficient

Salesforce  Acticor Biotech

Good diversification

The 3 months correlation between Salesforce and Acticor is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Acticor Biotech SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acticor Biotech SAS 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 Acticor Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acticor Biotech SAS has no effect on the direction of Salesforce i.e., Salesforce and Acticor Biotech go up and down completely randomly.

Pair Corralation between Salesforce and Acticor Biotech

Considering the 90-day investment horizon Salesforce is expected to generate 2.01 times more return on investment than Acticor Biotech. However, Salesforce is 2.01 times more volatile than Acticor Biotech SAS. It trades about -0.07 of its potential returns per unit of risk. Acticor Biotech SAS is currently generating about -0.22 per unit of risk. If you would invest  32,961  in Salesforce on November 29, 2024 and sell it today you would lose (3,459) from holding Salesforce or give up 10.49% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Salesforce  vs.  Acticor Biotech SAS

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 latest unfluctuating 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.

Acticor Biotech SAS

Risk-Adjusted Performance

Very Weak

Over the last 90 days Acticor Biotech SAS has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in March 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Salesforce and Acticor Biotech

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

The idea behind Salesforce and Acticor Biotech SAS 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.