Correlation Between SentinelOne and Graham Holdings
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Graham Holdings 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 Graham Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Graham Holdings Co, you can compare the effects of market volatilities on SentinelOne and Graham Holdings 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 Graham Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Graham Holdings.
Diversification Opportunities for SentinelOne and Graham Holdings
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SentinelOne and Graham is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Graham Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graham Holdings 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 Graham Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graham Holdings has no effect on the direction of SentinelOne i.e., SentinelOne and Graham Holdings go up and down completely randomly.
Pair Corralation between SentinelOne and Graham Holdings
Taking into account the 90-day investment horizon SentinelOne is expected to generate 2.79 times less return on investment than Graham Holdings. But when comparing it to its historical volatility, SentinelOne is 1.26 times less risky than Graham Holdings. It trades about 0.13 of its potential returns per unit of risk. Graham Holdings Co is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 77,858 in Graham Holdings Co on August 28, 2024 and sell it today you would earn a total of 16,552 from holding Graham Holdings Co or generate 21.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Graham Holdings Co
Performance |
| Timeline |
| SentinelOne |
| Graham Holdings |
SentinelOne and Graham Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Graham Holdings
The main advantage of trading using opposite SentinelOne and Graham Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Graham Holdings 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 Graham Holdings will offset losses from the drop in Graham Holdings' 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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