Correlation Between Salesforce and Stet Intermediate

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

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

Diversification Opportunities for Salesforce and Stet Intermediate

0.25

Correlation Coefficient

Salesforce  Stet Intermediate

Modest diversification

The 3 months correlation between Salesforce and Stet is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Stet Intermediate Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stet Intermediate Term 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 Stet Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stet Intermediate Term has no effect on the direction of Salesforce i.e., Salesforce and Stet Intermediate go up and down completely randomly.

Pair Corralation between Salesforce and Stet Intermediate

Considering the 90-day investment horizon Salesforce is expected to generate 16.44 times more return on investment than Stet Intermediate. However, Salesforce is 16.44 times more volatile than Stet Intermediate Term. It trades about 0.04 of its potential returns per unit of risk. Stet Intermediate Term is currently generating about 0.38 per unit of risk. If you would invest  25,188  in Salesforce on August 4, 2025 and sell it today you would earn a total of  853.00  from holding Salesforce or generate 3.39% return on investment over 90 days.

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

Salesforce  vs.  Stet Intermediate Term

Salesforce

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Salesforce are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Salesforce is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Stet Intermediate Term

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Stet Intermediate Term are ranked lower than 30 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Stet Intermediate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Salesforce and Stet Intermediate

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

The idea behind Salesforce and Stet Intermediate Term 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.