Correlation Between Senstar Technologies and IShares Edge
Can any of the company-specific risk be diversified away by investing in both Senstar Technologies and IShares Edge 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 Senstar Technologies and IShares Edge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Senstar Technologies and iShares Edge Investment, you can compare the effects of market volatilities on Senstar Technologies and IShares Edge 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 Senstar Technologies with a short position of IShares Edge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senstar Technologies and IShares Edge.
Diversification Opportunities for Senstar Technologies and IShares Edge
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Senstar and IShares is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Senstar Technologies and iShares Edge Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Edge Investment and Senstar Technologies 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 Senstar Technologies are associated (or correlated) with IShares Edge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Edge Investment has no effect on the direction of Senstar Technologies i.e., Senstar Technologies and IShares Edge go up and down completely randomly.
Pair Corralation between Senstar Technologies and IShares Edge
Considering the 90-day investment horizon Senstar Technologies is expected to generate 13.28 times more return on investment than IShares Edge. However, Senstar Technologies is 13.28 times more volatile than iShares Edge Investment. It trades about 0.14 of its potential returns per unit of risk. iShares Edge Investment is currently generating about 0.11 per unit of risk. If you would invest 142.00 in Senstar Technologies on August 30, 2024 and sell it today you would earn a total of 137.00 from holding Senstar Technologies or generate 96.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Senstar Technologies vs. iShares Edge Investment
Performance |
| Timeline |
| Senstar Technologies |
| iShares Edge Investment |
Senstar Technologies and IShares Edge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senstar Technologies and IShares Edge
The main advantage of trading using opposite Senstar Technologies and IShares Edge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senstar Technologies position performs unexpectedly, IShares Edge 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 IShares Edge will offset losses from the drop in IShares Edge's long position.| Senstar Technologies vs. Fabrinet | Senstar Technologies vs. Knowles Cor | Senstar Technologies vs. Ubiquiti Networks | Senstar Technologies vs. AmpliTech Group |
| IShares Edge vs. Schwab 1 5 Year | IShares Edge vs. Schwab Long Term Treasury | IShares Edge vs. Schwab Intermediate Term Treasury | IShares Edge vs. Schwab Short Term Treasury |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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