Correlation Between Apollo Commercial and SentinelOne

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

Diversification Opportunities for Apollo Commercial and SentinelOne

-0.28
  Correlation Coefficient

Very good diversification

The 3 months correlation between Apollo and SentinelOne is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Commercial Real and SentinelOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SentinelOne and Apollo Commercial 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 Apollo Commercial Real 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 Apollo Commercial i.e., Apollo Commercial and SentinelOne go up and down completely randomly.

Pair Corralation between Apollo Commercial and SentinelOne

Considering the 90-day investment horizon Apollo Commercial is expected to generate 1.51 times less return on investment than SentinelOne. But when comparing it to its historical volatility, Apollo Commercial Real is 2.16 times less risky than SentinelOne. It trades about 0.08 of its potential returns per unit of risk. SentinelOne is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  1,687  in SentinelOne on December 30, 2023 and sell it today you would earn a total of  644.00  from holding SentinelOne or generate 38.17% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Apollo Commercial Real  vs.  SentinelOne

 Performance 
       Timeline  
Apollo Commercial Real 

Risk-Adjusted Performance

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Very Weak
Over the last 90 days Apollo Commercial Real has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Apollo Commercial is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.
SentinelOne 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days SentinelOne has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, SentinelOne is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Apollo Commercial and SentinelOne Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Apollo Commercial and SentinelOne

The main advantage of trading using opposite Apollo Commercial and SentinelOne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Commercial 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.
The idea behind Apollo Commercial Real and SentinelOne 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.
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.

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