Correlation Between SentinelOne and RSL Electronics
Can any of the company-specific risk be diversified away by investing in both SentinelOne and RSL Electronics 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 RSL Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and RSL Electronics, you can compare the effects of market volatilities on SentinelOne and RSL Electronics 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 RSL Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and RSL Electronics.
Diversification Opportunities for SentinelOne and RSL Electronics
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SentinelOne and RSL is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and RSL Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RSL Electronics 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 RSL Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RSL Electronics has no effect on the direction of SentinelOne i.e., SentinelOne and RSL Electronics go up and down completely randomly.
Pair Corralation between SentinelOne and RSL Electronics
Taking into account the 90-day investment horizon SentinelOne is expected to generate 1.03 times more return on investment than RSL Electronics. However, SentinelOne is 1.03 times more volatile than RSL Electronics. It trades about 0.16 of its potential returns per unit of risk. RSL Electronics is currently generating about 0.08 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 | Very Weak |
| Accuracy | 76.19% |
| Values | Daily Returns |
SentinelOne vs. RSL Electronics
Performance |
| Timeline |
| SentinelOne |
| RSL Electronics |
SentinelOne and RSL Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and RSL Electronics
The main advantage of trading using opposite SentinelOne and RSL Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, RSL Electronics 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 RSL Electronics will offset losses from the drop in RSL Electronics' long position.| SentinelOne vs. Palo Alto Networks | SentinelOne vs. Uipath Inc | SentinelOne vs. Block Inc | SentinelOne vs. Adobe Systems Incorporated |
| RSL Electronics vs. Arad | RSL Electronics vs. Alony Hetz Properties | RSL Electronics vs. Airport City | RSL Electronics vs. Harel Insurance Investments |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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