Correlation Between SentinelOne and Eterna Therapeutics
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Eterna Therapeutics 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 Eterna Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Eterna Therapeutics, you can compare the effects of market volatilities on SentinelOne and Eterna Therapeutics 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 Eterna Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Eterna Therapeutics.
Diversification Opportunities for SentinelOne and Eterna Therapeutics
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SentinelOne and Eterna is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Eterna Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eterna Therapeutics 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 Eterna Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eterna Therapeutics has no effect on the direction of SentinelOne i.e., SentinelOne and Eterna Therapeutics go up and down completely randomly.
Pair Corralation between SentinelOne and Eterna Therapeutics
Taking into account the 90-day investment horizon SentinelOne is expected to generate 0.56 times more return on investment than Eterna Therapeutics. However, SentinelOne is 1.78 times less risky than Eterna Therapeutics. It trades about 0.02 of its potential returns per unit of risk. Eterna Therapeutics is currently generating about -0.08 per unit of risk. If you would invest 2,817 in SentinelOne on August 27, 2024 and sell it today you would earn a total of 37.00 from holding SentinelOne or generate 1.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Eterna Therapeutics
Performance |
| Timeline |
| SentinelOne |
| Eterna Therapeutics |
SentinelOne and Eterna Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Eterna Therapeutics
The main advantage of trading using opposite SentinelOne and Eterna Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Eterna Therapeutics 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 Eterna Therapeutics will offset losses from the drop in Eterna Therapeutics' long position.| SentinelOne vs. GigaCloud Technology Class | SentinelOne vs. Arqit Quantum | SentinelOne vs. Cemtrex | SentinelOne vs. Rapid7 Inc |
| Eterna Therapeutics vs. Eliem Therapeutics | Eterna Therapeutics vs. HCW Biologics | Eterna Therapeutics vs. Scpharmaceuticals | Eterna Therapeutics vs. Milestone Pharmaceuticals |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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