Correlation Between SentinelOne and Amcor Plc

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

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

Diversification Opportunities for SentinelOne and Amcor Plc

-0.08

Correlation Coefficient

SentinelOne  Amcor Plc

Good diversification

The 3 months correlation between SentinelOne and Amcor is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Amcor plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amcor plc 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 Amcor Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amcor plc has no effect on the direction of SentinelOne i.e., SentinelOne and Amcor Plc go up and down completely randomly.

Pair Corralation between SentinelOne and Amcor Plc

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the Amcor Plc. But the stock apears to be less risky and, when comparing its historical volatility, SentinelOne is 1.17 times less risky than Amcor Plc. The stock trades about -0.1 of its potential returns per unit of risk. The Amcor plc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  962.00  in Amcor plc on December 21, 2024 and sell it today you would earn a total of  29.00  from holding Amcor plc or generate 3.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	93.75%
Values	Daily Returns

SentinelOne  vs.  Amcor plc

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.

Amcor plc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Amcor plc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable fundamental indicators, Amcor Plc is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SentinelOne and Amcor Plc

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

The idea behind SentinelOne and Amcor plc 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.