Correlation Between Livetech and Salesforce

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

By analyzing existing cross correlation between Livetech da Bahia and salesforce inc, you can compare the effects of market volatilities on Livetech and Salesforce 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 Livetech with a short position of Salesforce. Check out your portfolio center. Please also check ongoing floating volatility patterns of Livetech and Salesforce.

Diversification Opportunities for Livetech and Salesforce

0.4

Correlation Coefficient

Livetech  Salesforce

Very weak diversification

The 3 months correlation between Livetech and Salesforce is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Livetech da Bahia and salesforce inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on salesforce inc and Livetech 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 Livetech da Bahia are associated (or correlated) with Salesforce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of salesforce inc has no effect on the direction of Livetech i.e., Livetech and Salesforce go up and down completely randomly.

Pair Corralation between Livetech and Salesforce

Assuming the 90 days trading horizon Livetech da Bahia is expected to generate 0.73 times more return on investment than Salesforce. However, Livetech da Bahia is 1.37 times less risky than Salesforce. It trades about -0.04 of its potential returns per unit of risk. salesforce inc is currently generating about -0.22 per unit of risk. If you would invest  224.00  in Livetech da Bahia on December 4, 2024 and sell it today you would lose (4.00) from holding Livetech da Bahia or give up 1.79% of portfolio value over 90 days.

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

Livetech da Bahia  vs.  salesforce inc

Livetech da Bahia

Risk-Adjusted Performance

Very Weak

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

salesforce inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days salesforce inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Livetech and Salesforce

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

The idea behind Livetech da Bahia and salesforce inc 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.