Correlation Between SentinelOne and Emkay Global

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

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

Diversification Opportunities for SentinelOne and Emkay Global

0.05

Correlation Coefficient

SentinelOne  Emkay Global

Significant diversification

The 3 months correlation between SentinelOne and Emkay is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Emkay Global Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emkay Global Financial 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 Emkay Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emkay Global Financial has no effect on the direction of SentinelOne i.e., SentinelOne and Emkay Global go up and down completely randomly.

Pair Corralation between SentinelOne and Emkay Global

Taking into account the 90-day investment horizon SentinelOne is expected to generate 2.82 times less return on investment than Emkay Global. In addition to that, SentinelOne is 1.07 times more volatile than Emkay Global Financial. It trades about 0.04 of its total potential returns per unit of risk. Emkay Global Financial is currently generating about 0.11 per unit of volatility. If you would invest  6,488  in Emkay Global Financial on October 23, 2024 and sell it today you would earn a total of  22,657  from holding Emkay Global Financial or generate 349.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	97.47%
Values	Daily Returns

SentinelOne  vs.  Emkay Global Financial

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 latest unsteady 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.

Emkay Global Financial

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Emkay Global Financial are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady forward-looking signals, Emkay Global may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with SentinelOne and Emkay Global

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

The idea behind SentinelOne and Emkay Global Financial 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.