Correlation Between SentinelOne and Zai Lab
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Zai Lab 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 Zai Lab into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Zai Lab, you can compare the effects of market volatilities on SentinelOne and Zai Lab 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 Zai Lab. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Zai Lab.
Diversification Opportunities for SentinelOne and Zai Lab
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SentinelOne and Zai is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Zai Lab in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zai Lab 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 Zai Lab. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zai Lab has no effect on the direction of SentinelOne i.e., SentinelOne and Zai Lab go up and down completely randomly.
Pair Corralation between SentinelOne and Zai Lab
Taking into account the 90-day investment horizon SentinelOne is expected to generate 2.99 times less return on investment than Zai Lab. But when comparing it to its historical volatility, SentinelOne is 1.58 times less risky than Zai Lab. It trades about 0.09 of its potential returns per unit of risk. Zai Lab is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,876 in Zai Lab on August 28, 2024 and sell it today you would earn a total of 933.00 from holding Zai Lab or generate 49.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Zai Lab
Performance |
| Timeline |
| SentinelOne |
| Zai Lab |
SentinelOne and Zai Lab Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Zai Lab
The main advantage of trading using opposite SentinelOne and Zai Lab positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Zai Lab 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 Zai Lab will offset losses from the drop in Zai Lab's long position.| SentinelOne vs. GigaCloud Technology Class | SentinelOne vs. Arqit Quantum | SentinelOne vs. Cemtrex | SentinelOne vs. Paysafe |
| Zai Lab vs. C4 Therapeutics | Zai Lab vs. Erasca Inc | Zai Lab vs. Cullinan Oncology LLC | Zai Lab vs. Legend Biotech Corp |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |