Correlation Between Senstar Technologies and Pacer Trendpilot
Can any of the company-specific risk be diversified away by investing in both Senstar Technologies and Pacer Trendpilot 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 Pacer Trendpilot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Senstar Technologies and Pacer Trendpilot Bond, you can compare the effects of market volatilities on Senstar Technologies and Pacer Trendpilot 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 Pacer Trendpilot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senstar Technologies and Pacer Trendpilot.
Diversification Opportunities for Senstar Technologies and Pacer Trendpilot
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Senstar and Pacer is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Senstar Technologies and Pacer Trendpilot Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacer Trendpilot Bond 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 Pacer Trendpilot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacer Trendpilot Bond has no effect on the direction of Senstar Technologies i.e., Senstar Technologies and Pacer Trendpilot go up and down completely randomly.
Pair Corralation between Senstar Technologies and Pacer Trendpilot
Considering the 90-day investment horizon Senstar Technologies is expected to generate 20.99 times more return on investment than Pacer Trendpilot. However, Senstar Technologies is 20.99 times more volatile than Pacer Trendpilot Bond. It trades about 0.25 of its potential returns per unit of risk. Pacer Trendpilot Bond is currently generating about -0.11 per unit of risk. If you would invest 159.00 in Senstar Technologies on August 30, 2024 and sell it today you would earn a total of 120.00 from holding Senstar Technologies or generate 75.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Senstar Technologies vs. Pacer Trendpilot Bond
Performance |
| Timeline |
| Senstar Technologies |
| Pacer Trendpilot Bond |
Senstar Technologies and Pacer Trendpilot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senstar Technologies and Pacer Trendpilot
The main advantage of trading using opposite Senstar Technologies and Pacer Trendpilot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senstar Technologies position performs unexpectedly, Pacer Trendpilot 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 Pacer Trendpilot will offset losses from the drop in Pacer Trendpilot's long position.| Senstar Technologies vs. Fabrinet | Senstar Technologies vs. Knowles Cor | Senstar Technologies vs. Ubiquiti Networks | Senstar Technologies vs. AmpliTech Group |
| Pacer Trendpilot vs. Schwab 1 5 Year | Pacer Trendpilot vs. Schwab Long Term Treasury | Pacer Trendpilot vs. Schwab Intermediate Term Treasury | Pacer Trendpilot 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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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