Correlation Between SentinelOne and Alligator Energy
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Alligator Energy 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 Alligator Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Alligator Energy Limited, you can compare the effects of market volatilities on SentinelOne and Alligator Energy 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 Alligator Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Alligator Energy.
Diversification Opportunities for SentinelOne and Alligator Energy
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SentinelOne and Alligator is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Alligator Energy Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alligator Energy 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 Alligator Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alligator Energy has no effect on the direction of SentinelOne i.e., SentinelOne and Alligator Energy go up and down completely randomly.
Pair Corralation between SentinelOne and Alligator Energy
Taking into account the 90-day investment horizon SentinelOne is expected to generate 0.39 times more return on investment than Alligator Energy. However, SentinelOne is 2.58 times less risky than Alligator Energy. It trades about 0.17 of its potential returns per unit of risk. Alligator Energy Limited is currently generating about 0.06 per unit of risk. If you would invest 2,579 in SentinelOne on September 1, 2024 and sell it today you would earn a total of 216.00 from holding SentinelOne or generate 8.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 91.3% |
| Values | Daily Returns |
SentinelOne vs. Alligator Energy Limited
Performance |
| Timeline |
| SentinelOne |
| Alligator Energy |
SentinelOne and Alligator Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Alligator Energy
The main advantage of trading using opposite SentinelOne and Alligator Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Alligator Energy 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 Alligator Energy will offset losses from the drop in Alligator Energy's long position.| SentinelOne vs. Palo Alto Networks | SentinelOne vs. Uipath Inc | SentinelOne vs. Block Inc | SentinelOne vs. Adobe Systems Incorporated |
| Alligator Energy vs. ATT Inc | Alligator Energy vs. Merck Company | Alligator Energy vs. Walt Disney | Alligator Energy vs. Caterpillar |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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