Correlation Between Salesforce and Paysafe

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

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

Diversification Opportunities for Salesforce and Paysafe

0.18

Correlation Coefficient

Salesforce  Paysafe

Average diversification

The 3 months correlation between Salesforce and Paysafe is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Paysafe Ltd Wt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paysafe Ltd Wt 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 Paysafe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paysafe Ltd Wt has no effect on the direction of Salesforce i.e., Salesforce and Paysafe go up and down completely randomly.

Pair Corralation between Salesforce and Paysafe

Considering the 90-day investment horizon Salesforce is expected to generate 0.28 times more return on investment than Paysafe. However, Salesforce is 3.63 times less risky than Paysafe. It trades about -0.05 of its potential returns per unit of risk. Paysafe Ltd Wt is currently generating about -0.03 per unit of risk. If you would invest  32,961  in Salesforce on November 28, 2024 and sell it today you would lose (2,373) from holding Salesforce or give up 7.2% of portfolio value over 90 days.

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

Salesforce  vs.  Paysafe Ltd Wt

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.

Paysafe Ltd Wt

Risk-Adjusted Performance

Very Weak

Over the last 90 days Paysafe Ltd Wt has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Salesforce and Paysafe

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

The idea behind Salesforce and Paysafe Ltd Wt 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.