Correlation Between SentinelOne and Garuda Metalindo

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Can any of the company-specific risk be diversified away by investing in both SentinelOne and Garuda Metalindo 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 Garuda Metalindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Garuda Metalindo Tbk, you can compare the effects of market volatilities on SentinelOne and Garuda Metalindo 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 Garuda Metalindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Garuda Metalindo.

Diversification Opportunities for SentinelOne and Garuda Metalindo

0.56
  Correlation Coefficient

Very weak diversification

The 3 months correlation between SentinelOne and Garuda is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Garuda Metalindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garuda Metalindo Tbk 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 Garuda Metalindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garuda Metalindo Tbk has no effect on the direction of SentinelOne i.e., SentinelOne and Garuda Metalindo go up and down completely randomly.

Pair Corralation between SentinelOne and Garuda Metalindo

Taking into account the 90-day investment horizon SentinelOne is expected to generate 0.86 times more return on investment than Garuda Metalindo. However, SentinelOne is 1.16 times less risky than Garuda Metalindo. It trades about 0.19 of its potential returns per unit of risk. Garuda Metalindo Tbk is currently generating about 0.03 per unit of risk. If you would invest  2,597  in SentinelOne on August 25, 2024 and sell it today you would earn a total of  257.00  from holding SentinelOne or generate 9.9% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

SentinelOne  vs.  Garuda Metalindo Tbk

 Performance 
       Timeline  
SentinelOne 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in SentinelOne are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, SentinelOne unveiled solid returns over the last few months and may actually be approaching a breakup point.
Garuda Metalindo Tbk 

Risk-Adjusted Performance

15 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Garuda Metalindo Tbk are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Garuda Metalindo disclosed solid returns over the last few months and may actually be approaching a breakup point.

SentinelOne and Garuda Metalindo Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SentinelOne and Garuda Metalindo

The main advantage of trading using opposite SentinelOne and Garuda Metalindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Garuda Metalindo 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 Garuda Metalindo will offset losses from the drop in Garuda Metalindo's long position.
The idea behind SentinelOne and Garuda Metalindo Tbk 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 Global Correlations module to find global opportunities by holding instruments from different markets.

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