Correlation Between SentinelOne and Pond Technologies

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

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

Diversification Opportunities for SentinelOne and Pond Technologies

-0.04

Correlation Coefficient

SentinelOne  Pond Technologies

Good diversification

The 3 months correlation between SentinelOne and Pond is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Pond Technologies Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pond Technologies 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 Pond Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pond Technologies has no effect on the direction of SentinelOne i.e., SentinelOne and Pond Technologies go up and down completely randomly.

Pair Corralation between SentinelOne and Pond Technologies

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the Pond Technologies. But the stock apears to be less risky and, when comparing its historical volatility, SentinelOne is 7.38 times less risky than Pond Technologies. The stock trades about -0.06 of its potential returns per unit of risk. The Pond Technologies Holdings is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2.00  in Pond Technologies Holdings on October 23, 2024 and sell it today you would earn a total of  0.00  from holding Pond Technologies Holdings or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

SentinelOne  vs.  Pond Technologies Holdings

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.

Pond Technologies

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pond Technologies Holdings are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Pond Technologies showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SentinelOne and Pond Technologies

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

The idea behind SentinelOne and Pond Technologies Holdings 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.

Check out your portfolio center.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.