Correlation Between EchoStar and SentinelOne
Can any of the company-specific risk be diversified away by investing in both EchoStar 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 EchoStar and SentinelOne into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EchoStar and SentinelOne, you can compare the effects of market volatilities on EchoStar 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 EchoStar with a short position of SentinelOne. Check out your portfolio center. Please also check ongoing floating volatility patterns of EchoStar and SentinelOne.
Diversification Opportunities for EchoStar and SentinelOne
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EchoStar and SentinelOne is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding EchoStar and SentinelOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SentinelOne and EchoStar 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 EchoStar 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 EchoStar i.e., EchoStar and SentinelOne go up and down completely randomly.
Pair Corralation between EchoStar and SentinelOne
Given the investment horizon of 90 days EchoStar is expected to generate 1.58 times more return on investment than SentinelOne. However, EchoStar is 1.58 times more volatile than SentinelOne. It trades about 0.17 of its potential returns per unit of risk. SentinelOne is currently generating about -0.11 per unit of risk. If you would invest 1,365 in EchoStar on January 25, 2024 and sell it today you would earn a total of 165.00 from holding EchoStar or generate 12.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EchoStar vs. SentinelOne
Performance |
| Timeline |
| EchoStar |
| SentinelOne |
EchoStar and SentinelOne Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EchoStar and SentinelOne
The main advantage of trading using opposite EchoStar and SentinelOne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EchoStar 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.| EchoStar vs. Desktop Metal | EchoStar vs. Fabrinet | EchoStar vs. Kimball Electronics | EchoStar vs. Knowles Cor |
| SentinelOne vs. Block Inc | SentinelOne vs. Adobe Systems Incorporated | SentinelOne vs. Crowdstrike Holdings | SentinelOne vs. Cloudflare |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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