Correlation Between SentinelOne and Lundin Gold
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Lundin Gold 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 Lundin Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Lundin Gold, you can compare the effects of market volatilities on SentinelOne and Lundin Gold 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 Lundin Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Lundin Gold.
Diversification Opportunities for SentinelOne and Lundin Gold
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SentinelOne and Lundin is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Lundin Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lundin Gold 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 Lundin Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lundin Gold has no effect on the direction of SentinelOne i.e., SentinelOne and Lundin Gold go up and down completely randomly.
Pair Corralation between SentinelOne and Lundin Gold
Taking into account the 90-day investment horizon SentinelOne is expected to generate 0.86 times more return on investment than Lundin Gold. However, SentinelOne is 1.16 times less risky than Lundin Gold. It trades about 0.17 of its potential returns per unit of risk. Lundin Gold is currently generating about -0.02 per unit of risk. If you would invest 2,579 in SentinelOne on September 1, 2024 and sell it today you would earn a total of 216.00 from holding SentinelOne or generate 8.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 91.3% |
| Values | Daily Returns |
SentinelOne vs. Lundin Gold
Performance |
| Timeline |
| SentinelOne |
| Lundin Gold |
SentinelOne and Lundin Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Lundin Gold
The main advantage of trading using opposite SentinelOne and Lundin Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Lundin Gold 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 Lundin Gold will offset losses from the drop in Lundin Gold's long position.| SentinelOne vs. Palo Alto Networks | SentinelOne vs. Uipath Inc | SentinelOne vs. Block Inc | SentinelOne vs. Adobe Systems Incorporated |
| Lundin Gold vs. Lundin Mining | Lundin Gold vs. Africa Oil Corp | Lundin Gold vs. International Petroleum | Lundin Gold vs. Boliden AB |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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