Correlation Between SentinelOne and GMxico Transportes

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

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

Diversification Opportunities for SentinelOne and GMxico Transportes

-0.64

Correlation Coefficient

SentinelOne  GMxico Transportes

Excellent diversification

The 3 months correlation between SentinelOne and GMxico is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and GMxico Transportes SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GMxico Transportes SAB 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 GMxico Transportes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GMxico Transportes SAB has no effect on the direction of SentinelOne i.e., SentinelOne and GMxico Transportes go up and down completely randomly.

Pair Corralation between SentinelOne and GMxico Transportes

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the GMxico Transportes. In addition to that, SentinelOne is 1.59 times more volatile than GMxico Transportes SAB. It trades about -0.11 of its total potential returns per unit of risk. GMxico Transportes SAB is currently generating about 0.06 per unit of volatility. If you would invest  3,150  in GMxico Transportes SAB on December 30, 2024 and sell it today you would earn a total of  161.00  from holding GMxico Transportes SAB or generate 5.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

SentinelOne  vs.  GMxico Transportes SAB

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.

GMxico Transportes SAB

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in GMxico Transportes SAB are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, GMxico Transportes is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SentinelOne and GMxico Transportes

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

The idea behind SentinelOne and GMxico Transportes SAB 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.