Correlation Between Salesforce and Wattanapat Hospital

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

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

Diversification Opportunities for Salesforce and Wattanapat Hospital

0.33

Correlation Coefficient

Salesforce  Wattanapat Hospital

Weak diversification

The 3 months correlation between Salesforce and Wattanapat is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Wattanapat Hospital Trang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wattanapat Hospital Trang 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 Wattanapat Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wattanapat Hospital Trang has no effect on the direction of Salesforce i.e., Salesforce and Wattanapat Hospital go up and down completely randomly.

Pair Corralation between Salesforce and Wattanapat Hospital

Considering the 90-day investment horizon Salesforce is expected to under-perform the Wattanapat Hospital. In addition to that, Salesforce is 1.11 times more volatile than Wattanapat Hospital Trang. It trades about -0.23 of its total potential returns per unit of risk. Wattanapat Hospital Trang is currently generating about 0.01 per unit of volatility. If you would invest  835.00  in Wattanapat Hospital Trang on January 26, 2024 and sell it today you would earn a total of  0.00  from holding Wattanapat Hospital Trang or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	85.71%
Values	Daily Returns

Salesforce  vs.  Wattanapat Hospital Trang

Salesforce

Risk-Adjusted Performance

0 of 100

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 very healthy basic indicators, Salesforce is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Wattanapat Hospital Trang

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Wattanapat Hospital Trang are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting technical indicators, Wattanapat Hospital disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Salesforce and Wattanapat Hospital

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

The idea behind Salesforce and Wattanapat Hospital Trang 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 AI Investment Finder module to use AI to screen and filter profitable investment opportunities.