Correlation Between SentinelOne and China Resources
Can any of the company-specific risk be diversified away by investing in both SentinelOne and China Resources 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 China Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and China Resources Land, you can compare the effects of market volatilities on SentinelOne and China Resources 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 China Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and China Resources.
Diversification Opportunities for SentinelOne and China Resources
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SentinelOne and China is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and China Resources Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Resources Land 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 China Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Resources Land has no effect on the direction of SentinelOne i.e., SentinelOne and China Resources go up and down completely randomly.
Pair Corralation between SentinelOne and China Resources
Taking into account the 90-day investment horizon SentinelOne is expected to generate 1.22 times more return on investment than China Resources. However, SentinelOne is 1.22 times more volatile than China Resources Land. It trades about 0.13 of its potential returns per unit of risk. China Resources Land is currently generating about -0.14 per unit of risk. If you would invest 2,609 in SentinelOne on August 28, 2024 and sell it today you would earn a total of 184.00 from holding SentinelOne or generate 7.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. China Resources Land
Performance |
| Timeline |
| SentinelOne |
| China Resources Land |
SentinelOne and China Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and China Resources
The main advantage of trading using opposite SentinelOne and China Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, China Resources 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 China Resources will offset losses from the drop in China Resources' long position.| SentinelOne vs. GigaCloud Technology Class | SentinelOne vs. Arqit Quantum | SentinelOne vs. Cemtrex | SentinelOne vs. Paysafe |
| China Resources vs. China Overseas Land | China Resources vs. Longfor Group Holdings | China Resources vs. Sun Hung Kai | China Resources vs. Country Garden Holdings |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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