Correlation Between Salesforce and Ambassador Fund

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

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

Diversification Opportunities for Salesforce and Ambassador Fund

-0.77

Correlation Coefficient

Salesforce  Ambassador Fund

Pay attention - limited upside

The 3 months correlation between Salesforce and Ambassador is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Ambassador Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ambassador Fund 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 Ambassador Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ambassador Fund has no effect on the direction of Salesforce i.e., Salesforce and Ambassador Fund go up and down completely randomly.

Pair Corralation between Salesforce and Ambassador Fund

Considering the 90-day investment horizon Salesforce is expected to under-perform the Ambassador Fund. In addition to that, Salesforce is 17.43 times more volatile than Ambassador Fund. It trades about -0.18 of its total potential returns per unit of risk. Ambassador Fund is currently generating about 0.14 per unit of volatility. If you would invest  995.00  in Ambassador Fund on December 23, 2024 and sell it today you would earn a total of  9.00  from holding Ambassador Fund or generate 0.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Salesforce  vs.  Ambassador Fund

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.

Ambassador Fund

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ambassador Fund are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Ambassador Fund is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Salesforce and Ambassador Fund

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

The idea behind Salesforce and Ambassador Fund 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.