Correlation Between SentinelOne and Avepoint

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

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

Diversification Opportunities for SentinelOne and Avepoint

0.86

Correlation Coefficient

SentinelOne  Avepoint

Very poor diversification

The 3 months correlation between SentinelOne and Avepoint is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Avepoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avepoint 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 Avepoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avepoint has no effect on the direction of SentinelOne i.e., SentinelOne and Avepoint go up and down completely randomly.

Pair Corralation between SentinelOne and Avepoint

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the Avepoint. But the stock apears to be less risky and, when comparing its historical volatility, SentinelOne is 1.27 times less risky than Avepoint. The stock trades about -0.11 of its potential returns per unit of risk. The Avepoint is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  1,648  in Avepoint on December 29, 2024 and sell it today you would lose (186.00) from holding Avepoint or give up 11.29% of portfolio value over 90 days.

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

SentinelOne  vs.  Avepoint

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.

Avepoint

Risk-Adjusted Performance

Very Weak

Over the last 90 days Avepoint has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with SentinelOne and Avepoint

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

The idea behind SentinelOne and Avepoint 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..