Correlation Between SALESFORCE INC and KUAISHOU TECHNOLOGY

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

By analyzing existing cross correlation between SALESFORCE INC CDR and KUAISHOU TECHNOLOGY CLB, you can compare the effects of market volatilities on SALESFORCE INC and KUAISHOU TECHNOLOGY 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 INC with a short position of KUAISHOU TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of SALESFORCE INC and KUAISHOU TECHNOLOGY.

Diversification Opportunities for SALESFORCE INC and KUAISHOU TECHNOLOGY

-0.76

Correlation Coefficient

SALESFORCE INC  KUAISHOU TECHNOLOGY

Pay attention - limited upside

The 3 months correlation between SALESFORCE and KUAISHOU is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding SALESFORCE INC CDR and KUAISHOU TECHNOLOGY CLB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KUAISHOU TECHNOLOGY CLB and SALESFORCE INC 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 INC CDR are associated (or correlated) with KUAISHOU TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KUAISHOU TECHNOLOGY CLB has no effect on the direction of SALESFORCE INC i.e., SALESFORCE INC and KUAISHOU TECHNOLOGY go up and down completely randomly.

Pair Corralation between SALESFORCE INC and KUAISHOU TECHNOLOGY

Assuming the 90 days trading horizon SALESFORCE INC CDR is expected to under-perform the KUAISHOU TECHNOLOGY. But the stock apears to be less risky and, when comparing its historical volatility, SALESFORCE INC CDR is 1.9 times less risky than KUAISHOU TECHNOLOGY. The stock trades about -0.15 of its potential returns per unit of risk. The KUAISHOU TECHNOLOGY CLB is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  514.00  in KUAISHOU TECHNOLOGY CLB on December 24, 2024 and sell it today you would earn a total of  175.00  from holding KUAISHOU TECHNOLOGY CLB or generate 34.05% return on investment over 90 days.

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

SALESFORCE INC CDR  vs.  KUAISHOU TECHNOLOGY CLB

SALESFORCE INC CDR

Risk-Adjusted Performance

Very Weak

Over the last 90 days SALESFORCE INC CDR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

KUAISHOU TECHNOLOGY CLB

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in KUAISHOU TECHNOLOGY CLB are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, KUAISHOU TECHNOLOGY reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SALESFORCE INC and KUAISHOU TECHNOLOGY

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

The idea behind SALESFORCE INC CDR and KUAISHOU TECHNOLOGY CLB 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.