Correlation Between SentinelOne and Nicholas

Can any of the company-specific risk be diversified away by investing in both SentinelOne and Nicholas 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 Nicholas into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SentinelOne and Nicholas Ii Inc, you can compare the effects of market volatilities on SentinelOne and Nicholas 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 Nicholas. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and Nicholas.

Diversification Opportunities for SentinelOne and Nicholas

-0.11

Correlation Coefficient

SentinelOne  Nicholas

Good diversification

The 3 months correlation between SentinelOne and Nicholas is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Nicholas Ii Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nicholas Ii 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 Nicholas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nicholas Ii has no effect on the direction of SentinelOne i.e., SentinelOne and Nicholas go up and down completely randomly.

Pair Corralation between SentinelOne and Nicholas

Taking into account the 90-day investment horizon SentinelOne is expected to generate 4.63 times more return on investment than Nicholas. However, SentinelOne is 4.63 times more volatile than Nicholas Ii Inc. It trades about 0.05 of its potential returns per unit of risk. Nicholas Ii Inc is currently generating about 0.06 per unit of risk. If you would invest  1,459  in SentinelOne on January 24, 2024 and sell it today you would earn a total of  588.00  from holding SentinelOne or generate 40.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

SentinelOne  vs.  Nicholas Ii Inc

SentinelOne

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SentinelOne has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in May 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Nicholas Ii

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nicholas Ii Inc has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Nicholas is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SentinelOne and Nicholas

The main advantage of trading using opposite SentinelOne and Nicholas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, Nicholas 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 Nicholas will offset losses from the drop in Nicholas' long position.

The idea behind SentinelOne and Nicholas Ii Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.