Correlation Between CareTrust REIT and SentinelOne
Can any of the company-specific risk be diversified away by investing in both CareTrust REIT 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 CareTrust REIT and SentinelOne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CareTrust REIT and SentinelOne, you can compare the effects of market volatilities on CareTrust REIT 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 CareTrust REIT with a short position of SentinelOne. Check out your portfolio center. Please also check ongoing floating volatility patterns of CareTrust REIT and SentinelOne.
Diversification Opportunities for CareTrust REIT and SentinelOne
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CareTrust and SentinelOne is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding CareTrust REIT and SentinelOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SentinelOne and CareTrust REIT 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 CareTrust REIT 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 CareTrust REIT i.e., CareTrust REIT and SentinelOne go up and down completely randomly.
Pair Corralation between CareTrust REIT and SentinelOne
Given the investment horizon of 90 days CareTrust REIT is expected to generate 0.42 times more return on investment than SentinelOne. However, CareTrust REIT is 2.4 times less risky than SentinelOne. It trades about 0.01 of its potential returns per unit of risk. SentinelOne is currently generating about -0.11 per unit of risk. If you would invest 2,388 in CareTrust REIT on January 25, 2024 and sell it today you would earn a total of 2.00 from holding CareTrust REIT or generate 0.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CareTrust REIT vs. SentinelOne
Performance |
| Timeline |
| CareTrust REIT |
| SentinelOne |
CareTrust REIT and SentinelOne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CareTrust REIT and SentinelOne
The main advantage of trading using opposite CareTrust REIT and SentinelOne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CareTrust REIT 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.| CareTrust REIT vs. Global Medical REIT | CareTrust REIT vs. Universal Health Realty | CareTrust REIT vs. Healthpeak Properties | CareTrust REIT vs. Healthcare Realty Trust |
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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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