Correlation Between SentinelOne and WisdomTree Europe

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Can any of the company-specific risk be diversified away by investing in both SentinelOne and WisdomTree Europe 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 WisdomTree Europe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and WisdomTree Europe Hedged, you can compare the effects of market volatilities on SentinelOne and WisdomTree Europe 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 WisdomTree Europe. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and WisdomTree Europe.

Diversification Opportunities for SentinelOne and WisdomTree Europe

-0.53
  Correlation Coefficient

Excellent diversification

The 3 months correlation between SentinelOne and WisdomTree is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and WisdomTree Europe Hedged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree Europe Hedged 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 WisdomTree Europe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree Europe Hedged has no effect on the direction of SentinelOne i.e., SentinelOne and WisdomTree Europe go up and down completely randomly.

Pair Corralation between SentinelOne and WisdomTree Europe

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the WisdomTree Europe. In addition to that, SentinelOne is 8.04 times more volatile than WisdomTree Europe Hedged. It trades about -0.07 of its total potential returns per unit of risk. WisdomTree Europe Hedged is currently generating about 0.12 per unit of volatility. If you would invest  5,222  in WisdomTree Europe Hedged on September 30, 2025 and sell it today you would earn a total of  53.00  from holding WisdomTree Europe Hedged or generate 1.01% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy95.24%
ValuesDaily Returns

SentinelOne  vs.  WisdomTree Europe Hedged

 Performance 
       Timeline  
SentinelOne 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days SentinelOne has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2026. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
WisdomTree Europe Hedged 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in WisdomTree Europe Hedged are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively steady fundamental indicators, WisdomTree Europe is not utilizing all of its potentials. The newest stock price chaos, may contribute to medium-term losses for the stakeholders.

SentinelOne and WisdomTree Europe Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SentinelOne and WisdomTree Europe

The main advantage of trading using opposite SentinelOne and WisdomTree Europe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, WisdomTree Europe 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 WisdomTree Europe will offset losses from the drop in WisdomTree Europe's long position.
The idea behind SentinelOne and WisdomTree Europe Hedged pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.

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