Correlation Between Apple and SentinelOne

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

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

Diversification Opportunities for Apple and SentinelOne

0.55

Correlation Coefficient

Apple  SentinelOne

Very weak diversification

The 3 months correlation between Apple and SentinelOne is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and SentinelOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SentinelOne and Apple 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 Apple Inc 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 Apple i.e., Apple and SentinelOne go up and down completely randomly.

Pair Corralation between Apple and SentinelOne

Given the investment horizon of 90 days Apple Inc is expected to generate 0.74 times more return on investment than SentinelOne. However, Apple Inc is 1.35 times less risky than SentinelOne. It trades about -0.12 of its potential returns per unit of risk. SentinelOne is currently generating about -0.11 per unit of risk. If you would invest  25,192  in Apple Inc on December 29, 2024 and sell it today you would lose (3,402) from holding Apple Inc or give up 13.5% of portfolio value over 90 days.

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

Apple Inc  vs.  SentinelOne

Apple Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apple Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

SentinelOne

Risk-Adjusted Performance

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 unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Apple and SentinelOne

The main advantage of trading using opposite Apple and SentinelOne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple 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.

The idea behind Apple Inc and SentinelOne 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.

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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.