Correlation Between SentinelOne and Himax Technologies
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Himax Technologies 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 Himax Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Himax Technologies, you can compare the effects of market volatilities on SentinelOne and Himax Technologies 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 Himax Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Himax Technologies.
Diversification Opportunities for SentinelOne and Himax Technologies
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between SentinelOne and Himax is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Himax Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Himax Technologies 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 Himax Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Himax Technologies has no effect on the direction of SentinelOne i.e., SentinelOne and Himax Technologies go up and down completely randomly.
Pair Corralation between SentinelOne and Himax Technologies
Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the Himax Technologies. But the stock apears to be less risky and, when comparing its historical volatility, SentinelOne is 3.14 times less risky than Himax Technologies. The stock trades about -0.16 of its potential returns per unit of risk. The Himax Technologies is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 544.00 in Himax Technologies on December 3, 2024 and sell it today you would earn a total of 386.00 from holding Himax Technologies or generate 70.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Himax Technologies
Performance |
| Timeline |
| SentinelOne |
| Himax Technologies |
SentinelOne and Himax Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Himax Technologies
The main advantage of trading using opposite SentinelOne and Himax Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Himax Technologies 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 Himax Technologies will offset losses from the drop in Himax Technologies' long position.| SentinelOne vs. Palo Alto Networks | ||
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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