Correlation Between Salesforce and Phathom Pharmaceuticals

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

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

Diversification Opportunities for Salesforce and Phathom Pharmaceuticals

-0.54

Correlation Coefficient

Salesforce  Phathom Pharmaceuticals

Excellent diversification

The 3 months correlation between Salesforce and Phathom is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Phathom Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phathom Pharmaceuticals 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 Phathom Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phathom Pharmaceuticals has no effect on the direction of Salesforce i.e., Salesforce and Phathom Pharmaceuticals go up and down completely randomly.

Pair Corralation between Salesforce and Phathom Pharmaceuticals

Considering the 90-day investment horizon Salesforce is expected to under-perform the Phathom Pharmaceuticals. But the stock apears to be less risky and, when comparing its historical volatility, Salesforce is 2.15 times less risky than Phathom Pharmaceuticals. The stock trades about -0.06 of its potential returns per unit of risk. The Phathom Pharmaceuticals is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  832.00  in Phathom Pharmaceuticals on July 17, 2025 and sell it today you would earn a total of  418.00  from holding Phathom Pharmaceuticals or generate 50.24% return on investment over 90 days.

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

Salesforce  vs.  Phathom Pharmaceuticals

Salesforce

Risk-Adjusted Performance

Weakest

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.

Phathom Pharmaceuticals

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Phathom Pharmaceuticals are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Phathom Pharmaceuticals unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Salesforce and Phathom Pharmaceuticals

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

The idea behind Salesforce and Phathom Pharmaceuticals 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.