Correlation Between SentinelOne and First Trust
Can any of the company-specific risk be diversified away by investing in both SentinelOne and First Trust 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 First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and First Trust Mid, you can compare the effects of market volatilities on SentinelOne and First Trust 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 First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and First Trust.
Diversification Opportunities for SentinelOne and First Trust
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SentinelOne and First is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and First Trust Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Mid 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 First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Mid has no effect on the direction of SentinelOne i.e., SentinelOne and First Trust go up and down completely randomly.
Pair Corralation between SentinelOne and First Trust
Taking into account the 90-day investment horizon SentinelOne is expected to generate 3.04 times more return on investment than First Trust. However, SentinelOne is 3.04 times more volatile than First Trust Mid. It trades about 0.16 of its potential returns per unit of risk. First Trust Mid is currently generating about 0.1 per unit of risk. If you would invest 1,722 in SentinelOne on September 1, 2024 and sell it today you would earn a total of 1,073 from holding SentinelOne or generate 62.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 70.63% |
| Values | Daily Returns |
SentinelOne vs. First Trust Mid
Performance |
| Timeline |
| SentinelOne |
| First Trust Mid |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
SentinelOne and First Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and First Trust
The main advantage of trading using opposite SentinelOne and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.| SentinelOne vs. Palo Alto Networks | SentinelOne vs. Uipath Inc | SentinelOne vs. Block Inc | SentinelOne vs. Adobe Systems Incorporated |
| First Trust vs. First Trust Small | First Trust vs. First Trust Equity | First Trust vs. First Trust Emerging |
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.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| 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 | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |