Correlation Between ABIOMED and SentinelOne
Can any of the company-specific risk be diversified away by investing in both ABIOMED and SentinelOne 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 ABIOMED and SentinelOne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABIOMED and SentinelOne, you can compare the effects of market volatilities on ABIOMED and SentinelOne 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 ABIOMED with a short position of SentinelOne. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABIOMED and SentinelOne.
Diversification Opportunities for ABIOMED and SentinelOne
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ABIOMED and SentinelOne is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding ABIOMED and SentinelOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SentinelOne and ABIOMED 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 ABIOMED are associated (or correlated) with SentinelOne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SentinelOne has no effect on the direction of ABIOMED i.e., ABIOMED and SentinelOne go up and down completely randomly.
Pair Corralation between ABIOMED and SentinelOne
Given the investment horizon of 90 days ABIOMED is expected to under-perform the SentinelOne. In addition to that, ABIOMED is 2.05 times more volatile than SentinelOne. It trades about -0.03 of its total potential returns per unit of risk. SentinelOne is currently generating about 0.01 per unit of volatility. If you would invest 2,611 in SentinelOne on January 26, 2024 and sell it today you would lose (454.00) from holding SentinelOne or give up 17.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 33.6% |
| Values | Daily Returns |
ABIOMED vs. SentinelOne
Performance |
| Timeline |
| ABIOMED |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SentinelOne |
ABIOMED and SentinelOne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABIOMED and SentinelOne
The main advantage of trading using opposite ABIOMED and SentinelOne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABIOMED position performs unexpectedly, SentinelOne 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 SentinelOne will offset losses from the drop in SentinelOne's long position.| ABIOMED vs. Summit Materials | ABIOMED vs. Western Copper and | ABIOMED vs. Cardinal Health | ABIOMED vs. Hudson Technologies |
| SentinelOne vs. Crowdstrike Holdings | SentinelOne vs. Block Inc | SentinelOne vs. Adobe Systems Incorporated | SentinelOne vs. Cloudflare |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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