Correlation Between IMCO Industries and SentinelOne
Can any of the company-specific risk be diversified away by investing in both IMCO Industries 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 IMCO Industries and SentinelOne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IMCO Industries and SentinelOne, you can compare the effects of market volatilities on IMCO Industries 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 IMCO Industries with a short position of SentinelOne. Check out your portfolio center. Please also check ongoing floating volatility patterns of IMCO Industries and SentinelOne.
Diversification Opportunities for IMCO Industries and SentinelOne
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between IMCO and SentinelOne is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding IMCO Industries and SentinelOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SentinelOne and IMCO Industries 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 IMCO Industries 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 IMCO Industries i.e., IMCO Industries and SentinelOne go up and down completely randomly.
Pair Corralation between IMCO Industries and SentinelOne
Assuming the 90 days trading horizon IMCO Industries is expected to generate 1.66 times more return on investment than SentinelOne. However, IMCO Industries is 1.66 times more volatile than SentinelOne. It trades about 0.07 of its potential returns per unit of risk. SentinelOne is currently generating about -0.05 per unit of risk. If you would invest 259,900 in IMCO Industries on January 26, 2024 and sell it today you would earn a total of 9,200 from holding IMCO Industries or generate 3.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 76.19% |
| Values | Daily Returns |
IMCO Industries vs. SentinelOne
Performance |
| Timeline |
| IMCO Industries |
| SentinelOne |
IMCO Industries and SentinelOne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IMCO Industries and SentinelOne
The main advantage of trading using opposite IMCO Industries and SentinelOne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IMCO Industries 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.| IMCO Industries vs. Alony Hetz Properties | IMCO Industries vs. Melisron | IMCO Industries vs. Shufersal | IMCO Industries vs. Israel Discount Bank |
| SentinelOne vs. Palo Alto Networks | SentinelOne vs. Crowdstrike Holdings | SentinelOne vs. Microsoft | SentinelOne vs. Block Inc |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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