Correlation Between SentinelOne and Costco Wholesale
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Costco Wholesale 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 Costco Wholesale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Costco Wholesale, you can compare the effects of market volatilities on SentinelOne and Costco Wholesale 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 Costco Wholesale. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Costco Wholesale.
Diversification Opportunities for SentinelOne and Costco Wholesale
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SentinelOne and Costco is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Costco Wholesale in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Costco Wholesale 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 Costco Wholesale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Costco Wholesale has no effect on the direction of SentinelOne i.e., SentinelOne and Costco Wholesale go up and down completely randomly.
Pair Corralation between SentinelOne and Costco Wholesale
Taking into account the 90-day investment horizon SentinelOne is expected to generate 2.7 times more return on investment than Costco Wholesale. However, SentinelOne is 2.7 times more volatile than Costco Wholesale. It trades about 0.06 of its potential returns per unit of risk. Costco Wholesale is currently generating about 0.12 per unit of risk. If you would invest 1,397 in SentinelOne on August 28, 2024 and sell it today you would earn a total of 1,391 from holding SentinelOne or generate 99.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Costco Wholesale
Performance |
| Timeline |
| SentinelOne |
| Costco Wholesale |
SentinelOne and Costco Wholesale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Costco Wholesale
The main advantage of trading using opposite SentinelOne and Costco Wholesale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Costco Wholesale 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 Costco Wholesale will offset losses from the drop in Costco Wholesale's long position.| SentinelOne vs. GigaCloud Technology Class | SentinelOne vs. Arqit Quantum | SentinelOne vs. Cemtrex | SentinelOne vs. Paysafe |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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