Correlation Between SentinelOne and New Horizon
Can any of the company-specific risk be diversified away by investing in both SentinelOne and New Horizon 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 New Horizon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SentinelOne and New Horizon Group, you can compare the effects of market volatilities on SentinelOne and New Horizon 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 New Horizon. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and New Horizon.
Diversification Opportunities for SentinelOne and New Horizon
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SentinelOne and New is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and New Horizon Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Horizon Group 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 New Horizon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Horizon Group has no effect on the direction of SentinelOne i.e., SentinelOne and New Horizon go up and down completely randomly.
Pair Corralation between SentinelOne and New Horizon
Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the New Horizon. But the stock apears to be less risky and, when comparing its historical volatility, SentinelOne is 2.85 times less risky than New Horizon. The stock trades about -0.05 of its potential returns per unit of risk. The New Horizon Group is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 36,990 in New Horizon Group on January 26, 2024 and sell it today you would earn a total of 18,810 from holding New Horizon Group or generate 50.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 76.19% |
| Values | Daily Returns |
SentinelOne vs. New Horizon Group
Performance |
| Timeline |
| SentinelOne |
| New Horizon Group |
SentinelOne and New Horizon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SentinelOne and New Horizon
The main advantage of trading using opposite SentinelOne and New Horizon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, New Horizon 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 New Horizon will offset losses from the drop in New Horizon's long position.| SentinelOne vs. Crowdstrike Holdings | SentinelOne vs. Okta Inc | SentinelOne vs. Cloudflare | SentinelOne vs. MongoDB |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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