Correlation Between SentinelOne and FlexShares STOXX

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

By analyzing existing cross correlation between SentinelOne and FlexShares STOXX Global, you can compare the effects of market volatilities on SentinelOne and FlexShares STOXX 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 SentinelOne with a short position of FlexShares STOXX. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and FlexShares STOXX.

Diversification Opportunities for SentinelOne and FlexShares STOXX

0.2

Correlation Coefficient

SentinelOne  FlexShares STOXX

Modest diversification

The 3 months correlation between SentinelOne and FlexShares is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and FlexShares STOXX Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FlexShares STOXX Global and SentinelOne 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 SentinelOne are associated (or correlated) with FlexShares STOXX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FlexShares STOXX Global has no effect on the direction of SentinelOne i.e., SentinelOne and FlexShares STOXX go up and down completely randomly.

Pair Corralation between SentinelOne and FlexShares STOXX

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the FlexShares STOXX. In addition to that, SentinelOne is 3.79 times more volatile than FlexShares STOXX Global. It trades about -0.21 of its total potential returns per unit of risk. FlexShares STOXX Global is currently generating about 0.06 per unit of volatility. If you would invest  5,369  in FlexShares STOXX Global on March 9, 2024 and sell it today you would earn a total of  97.00  from holding FlexShares STOXX Global or generate 1.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	97.73%
Values	Daily Returns

SentinelOne  vs.  FlexShares STOXX Global

SentinelOne

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SentinelOne has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in July 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

FlexShares STOXX Global

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FlexShares STOXX Global are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, FlexShares STOXX is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SentinelOne and FlexShares STOXX

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

The idea behind SentinelOne and FlexShares STOXX Global 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.