Correlation Between SentinelOne and Sumitomo Mitsui
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Sumitomo Mitsui 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 Sumitomo Mitsui into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Sumitomo Mitsui Financial, you can compare the effects of market volatilities on SentinelOne and Sumitomo Mitsui 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 Sumitomo Mitsui. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Sumitomo Mitsui.
Diversification Opportunities for SentinelOne and Sumitomo Mitsui
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SentinelOne and Sumitomo is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Sumitomo Mitsui Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sumitomo Mitsui Financial 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 Sumitomo Mitsui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sumitomo Mitsui Financial has no effect on the direction of SentinelOne i.e., SentinelOne and Sumitomo Mitsui go up and down completely randomly.
Pair Corralation between SentinelOne and Sumitomo Mitsui
Taking into account the 90-day investment horizon SentinelOne is expected to generate 23.99 times less return on investment than Sumitomo Mitsui. But when comparing it to its historical volatility, SentinelOne is 12.06 times less risky than Sumitomo Mitsui. It trades about 0.06 of its potential returns per unit of risk. Sumitomo Mitsui Financial is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,037 in Sumitomo Mitsui Financial on August 27, 2024 and sell it today you would earn a total of 1,424 from holding Sumitomo Mitsui Financial or generate 137.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.48% |
| Values | Daily Returns |
SentinelOne vs. Sumitomo Mitsui Financial
Performance |
| Timeline |
| SentinelOne |
| Sumitomo Mitsui Financial |
SentinelOne and Sumitomo Mitsui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Sumitomo Mitsui
The main advantage of trading using opposite SentinelOne and Sumitomo Mitsui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Sumitomo Mitsui 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 Sumitomo Mitsui will offset losses from the drop in Sumitomo Mitsui's long position.| SentinelOne vs. GigaCloud Technology Class | SentinelOne vs. Arqit Quantum | SentinelOne vs. Cemtrex | SentinelOne vs. Paysafe |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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