Correlation Between SentinelOne and Freightcar America
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Freightcar America 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 Freightcar America into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Freightcar America, you can compare the effects of market volatilities on SentinelOne and Freightcar America 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 Freightcar America. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Freightcar America.
Diversification Opportunities for SentinelOne and Freightcar America
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between SentinelOne and Freightcar is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Freightcar America in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freightcar America 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 Freightcar America. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freightcar America has no effect on the direction of SentinelOne i.e., SentinelOne and Freightcar America go up and down completely randomly.
Pair Corralation between SentinelOne and Freightcar America
Taking into account the 90-day investment horizon SentinelOne is expected to generate 4.99 times less return on investment than Freightcar America. But when comparing it to its historical volatility, SentinelOne is 2.19 times less risky than Freightcar America. It trades about 0.17 of its potential returns per unit of risk. Freightcar America is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 1,000.00 in Freightcar America on November 9, 2024 and sell it today you would earn a total of 333.00 from holding Freightcar America or generate 33.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Freightcar America
Performance |
| Timeline |
| SentinelOne |
| Freightcar America |
SentinelOne and Freightcar America Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Freightcar America
The main advantage of trading using opposite SentinelOne and Freightcar America positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Freightcar America 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 Freightcar America will offset losses from the drop in Freightcar America's long position.| SentinelOne vs. Crowdstrike Holdings | SentinelOne vs. Okta Inc | SentinelOne vs. Cloudflare | SentinelOne vs. MongoDB |
| Freightcar America vs. Greenbrier Companies | Freightcar America vs. LB Foster | Freightcar America vs. Westinghouse Air Brake | Freightcar America vs. CSX Corporation |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |