Correlation Between SentinelOne and Legg Mason
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Legg Mason 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 Legg Mason into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Legg Mason Low, you can compare the effects of market volatilities on SentinelOne and Legg Mason 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 Legg Mason. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Legg Mason.
Diversification Opportunities for SentinelOne and Legg Mason
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SentinelOne and Legg is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Legg Mason Low in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Legg Mason Low 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 Legg Mason. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Legg Mason Low has no effect on the direction of SentinelOne i.e., SentinelOne and Legg Mason go up and down completely randomly.
Pair Corralation between SentinelOne and Legg Mason
Taking into account the 90-day investment horizon SentinelOne is expected to generate 4.93 times more return on investment than Legg Mason. However, SentinelOne is 4.93 times more volatile than Legg Mason Low. It trades about 0.05 of its potential returns per unit of risk. Legg Mason Low is currently generating about 0.05 per unit of risk. If you would invest 1,595 in SentinelOne on September 1, 2024 and sell it today you would earn a total of 1,200 from holding SentinelOne or generate 75.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Legg Mason Low
Performance |
| Timeline |
| SentinelOne |
| Legg Mason Low |
SentinelOne and Legg Mason Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Legg Mason
The main advantage of trading using opposite SentinelOne and Legg Mason positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Legg Mason 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 Legg Mason will offset losses from the drop in Legg Mason's long position.| SentinelOne vs. Palo Alto Networks | SentinelOne vs. Uipath Inc | SentinelOne vs. Block Inc | SentinelOne vs. Adobe Systems Incorporated |
| Legg Mason vs. iShares Core SP | Legg Mason vs. iShares Core MSCI | Legg Mason vs. iShares Broad USD | Legg Mason vs. iShares Core SP |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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