Correlation Between SentinelOne and AG Mortgage
Can any of the company-specific risk be diversified away by investing in both SentinelOne and AG Mortgage 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 AG Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and AG Mortgage Investment, you can compare the effects of market volatilities on SentinelOne and AG Mortgage 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 AG Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and AG Mortgage.
Diversification Opportunities for SentinelOne and AG Mortgage
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SentinelOne and MITT-PB is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and AG Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AG Mortgage Investment 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 AG Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AG Mortgage Investment has no effect on the direction of SentinelOne i.e., SentinelOne and AG Mortgage go up and down completely randomly.
Pair Corralation between SentinelOne and AG Mortgage
Taking into account the 90-day investment horizon SentinelOne is expected to generate 3.5 times more return on investment than AG Mortgage. However, SentinelOne is 3.5 times more volatile than AG Mortgage Investment. It trades about 0.12 of its potential returns per unit of risk. AG Mortgage Investment is currently generating about -0.01 per unit of risk. If you would invest 2,647 in SentinelOne on August 31, 2024 and sell it today you would earn a total of 161.00 from holding SentinelOne or generate 6.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. AG Mortgage Investment
Performance |
| Timeline |
| SentinelOne |
| AG Mortgage Investment |
SentinelOne and AG Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and AG Mortgage
The main advantage of trading using opposite SentinelOne and AG Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, AG Mortgage 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 AG Mortgage will offset losses from the drop in AG Mortgage's long position.| SentinelOne vs. Crowdstrike Holdings | SentinelOne vs. Okta Inc | SentinelOne vs. Cloudflare | SentinelOne vs. MongoDB |
| AG Mortgage vs. MFA Financial | AG Mortgage vs. Chimera Investment | AG Mortgage vs. Two Harbors Investment | AG Mortgage vs. Chimera Investment |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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