Correlation Between SentinelOne and Caledonia Mining
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Caledonia Mining 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 Caledonia Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Caledonia Mining, you can compare the effects of market volatilities on SentinelOne and Caledonia Mining 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 Caledonia Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Caledonia Mining.
Diversification Opportunities for SentinelOne and Caledonia Mining
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between SentinelOne and Caledonia is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Caledonia Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caledonia Mining 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 Caledonia Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caledonia Mining has no effect on the direction of SentinelOne i.e., SentinelOne and Caledonia Mining go up and down completely randomly.
Pair Corralation between SentinelOne and Caledonia Mining
Taking into account the 90-day investment horizon SentinelOne is expected to generate 0.82 times more return on investment than Caledonia Mining. However, SentinelOne is 1.21 times less risky than Caledonia Mining. It trades about 0.15 of its potential returns per unit of risk. Caledonia Mining is currently generating about -0.25 per unit of risk. If you would invest 2,392 in SentinelOne on August 29, 2024 and sell it today you would earn a total of 401.00 from holding SentinelOne or generate 16.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Caledonia Mining
Performance |
| Timeline |
| SentinelOne |
| Caledonia Mining |
SentinelOne and Caledonia Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Caledonia Mining
The main advantage of trading using opposite SentinelOne and Caledonia Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Caledonia Mining 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 Caledonia Mining will offset losses from the drop in Caledonia Mining's long position.| SentinelOne vs. Crowdstrike Holdings | SentinelOne vs. Okta Inc | SentinelOne vs. Cloudflare | SentinelOne vs. MongoDB |
| Caledonia Mining vs. DRDGOLD Limited ADR | Caledonia Mining vs. Galiano Gold | Caledonia Mining vs. Mastech Holdings | Caledonia Mining vs. EMX Royalty Corp |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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