Correlation Between Salesforce and Rigetti Computing

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

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

Diversification Opportunities for Salesforce and Rigetti Computing

0.46

Correlation Coefficient

Salesforce  Rigetti Computing

Very weak diversification

The 3 months correlation between Salesforce and Rigetti is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Rigetti Computing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rigetti Computing 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 Rigetti Computing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rigetti Computing has no effect on the direction of Salesforce i.e., Salesforce and Rigetti Computing go up and down completely randomly.

Pair Corralation between Salesforce and Rigetti Computing

Considering the 90-day investment horizon Salesforce is expected to under-perform the Rigetti Computing. But the stock apears to be less risky and, when comparing its historical volatility, Salesforce is 8.24 times less risky than Rigetti Computing. The stock trades about -0.18 of its potential returns per unit of risk. The Rigetti Computing is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  1,096  in Rigetti Computing on December 23, 2024 and sell it today you would lose (189.00) from holding Rigetti Computing or give up 17.24% of portfolio value over 90 days.

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

Salesforce  vs.  Rigetti Computing

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.

Rigetti Computing

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Rigetti Computing are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Rigetti Computing demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Salesforce and Rigetti Computing

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

The idea behind Salesforce and Rigetti Computing 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.