Correlation Between SentinelOne and Twitter

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

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

Diversification Opportunities for SentinelOne and Twitter

-0.78

Correlation Coefficient

SentinelOne  Twitter

Pay attention - limited upside

The 3 months correlation between SentinelOne and Twitter is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Twitter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Twitter 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 Twitter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Twitter has no effect on the direction of SentinelOne i.e., SentinelOne and Twitter go up and down completely randomly.

Pair Corralation between SentinelOne and Twitter

Taking into account the 90-day investment horizon SentinelOne is expected to generate 18.9 times less return on investment than Twitter. In addition to that, SentinelOne is 1.33 times more volatile than Twitter. It trades about 0.0 of its total potential returns per unit of risk. Twitter is currently generating about 0.04 per unit of volatility. If you would invest  4,864  in Twitter on January 17, 2024 and sell it today you would earn a total of  506.00  from holding Twitter or generate 10.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	26.06%
Values	Daily Returns

SentinelOne  vs.  Twitter

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 uncertain 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.

Twitter

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Twitter has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Twitter is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with SentinelOne and Twitter

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

The idea behind SentinelOne and Twitter 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 CEOs Directory module to screen CEOs from public companies around the world.