Correlation Between SentinelOne and Perrigo Company
Can any of the company-specific risk be diversified away by investing in both SentinelOne and Perrigo Company 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 Perrigo Company into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and Perrigo Company PLC, you can compare the effects of market volatilities on SentinelOne and Perrigo Company 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 Perrigo Company. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Perrigo Company.
Diversification Opportunities for SentinelOne and Perrigo Company
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between SentinelOne and Perrigo is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Perrigo Company PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perrigo Company 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 Perrigo Company. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perrigo Company has no effect on the direction of SentinelOne i.e., SentinelOne and Perrigo Company go up and down completely randomly.
Pair Corralation between SentinelOne and Perrigo Company
Taking into account the 90-day investment horizon SentinelOne is expected to generate 2.09 times more return on investment than Perrigo Company. However, SentinelOne is 2.09 times more volatile than Perrigo Company PLC. It trades about 0.01 of its potential returns per unit of risk. Perrigo Company PLC is currently generating about -0.01 per unit of risk. If you would invest 2,519 in SentinelOne on January 25, 2024 and sell it today you would lose (362.00) from holding SentinelOne or give up 14.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SentinelOne vs. Perrigo Company PLC
Performance |
| Timeline |
| SentinelOne |
| Perrigo Company |
SentinelOne and Perrigo Company Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and Perrigo Company
The main advantage of trading using opposite SentinelOne and Perrigo Company positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Perrigo Company 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 Perrigo Company will offset losses from the drop in Perrigo Company's long position.| SentinelOne vs. Crowdstrike Holdings | SentinelOne vs. Okta Inc | SentinelOne vs. Cloudflare | SentinelOne vs. MongoDB |
| Perrigo Company vs. Prestige Brand Holdings | Perrigo Company vs. Amphastar P | Perrigo Company vs. Deciphera Pharmaceuticals LLC | Perrigo Company vs. Pacira Pharmaceuticals |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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