Correlation Between Salesforce and Townsquare Media
Can any of the company-specific risk be diversified away by investing in both Salesforce and Townsquare Media 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 Townsquare Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salesforce and Townsquare Media, you can compare the effects of market volatilities on Salesforce and Townsquare Media 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 Townsquare Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salesforce and Townsquare Media.
Diversification Opportunities for Salesforce and Townsquare Media
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Salesforce and Townsquare is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Salesforce and Townsquare Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Townsquare Media 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 Townsquare Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Townsquare Media has no effect on the direction of Salesforce i.e., Salesforce and Townsquare Media go up and down completely randomly.
Pair Corralation between Salesforce and Townsquare Media
Considering the 90-day investment horizon Salesforce is expected to generate 0.67 times more return on investment than Townsquare Media. However, Salesforce is 1.49 times less risky than Townsquare Media. It trades about -0.11 of its potential returns per unit of risk. Townsquare Media is currently generating about -0.12 per unit of risk. If you would invest 27,317 in Salesforce on July 8, 2025 and sell it today you would lose (3,281) from holding Salesforce or give up 12.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salesforce vs. Townsquare Media
Performance |
| Timeline |
| Salesforce |
| Townsquare Media |
Salesforce and Townsquare Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salesforce and Townsquare Media
The main advantage of trading using opposite Salesforce and Townsquare Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salesforce position performs unexpectedly, Townsquare Media 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 Townsquare Media will offset losses from the drop in Townsquare Media's long position.| Salesforce vs. Zoom Video Communications | Salesforce vs. C3 Ai Inc | Salesforce vs. Shopify | Salesforce vs. Workday |
| Townsquare Media vs. Travelzoo | Townsquare Media vs. Emerald Expositions Events | Townsquare Media vs. Ziff Davis | Townsquare Media vs. Direct Digital Holdings |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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