Correlation Between SentinelOne and LOEWS

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Can any of the company-specific risk be diversified away by investing in both SentinelOne and LOEWS 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 LOEWS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and LOEWS P 4125, you can compare the effects of market volatilities on SentinelOne and LOEWS 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 LOEWS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and LOEWS.

Diversification Opportunities for SentinelOne and LOEWS

-0.5
  Correlation Coefficient

Very good diversification

The 3 months correlation between SentinelOne and LOEWS is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and LOEWS P 4125 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOEWS P 4125 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 LOEWS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOEWS P 4125 has no effect on the direction of SentinelOne i.e., SentinelOne and LOEWS go up and down completely randomly.

Pair Corralation between SentinelOne and LOEWS

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the LOEWS. In addition to that, SentinelOne is 1.9 times more volatile than LOEWS P 4125. It trades about -0.11 of its total potential returns per unit of risk. LOEWS P 4125 is currently generating about -0.07 per unit of volatility. If you would invest  8,289  in LOEWS P 4125 on November 28, 2024 and sell it today you would lose (112.00) from holding LOEWS P 4125 or give up 1.35% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy66.67%
ValuesDaily Returns

SentinelOne  vs.  LOEWS P 4125

 Performance 
       Timeline  
SentinelOne 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days SentinelOne has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in March 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
LOEWS P 4125 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days LOEWS P 4125 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for LOEWS P 4125 investors.

SentinelOne and LOEWS Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SentinelOne and LOEWS

The main advantage of trading using opposite SentinelOne and LOEWS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, LOEWS 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 LOEWS will offset losses from the drop in LOEWS's long position.
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The idea behind SentinelOne and LOEWS P 4125 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Stocks Directory module to find actively traded stocks across global markets.

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