Correlation Between SentinelOne and SVENSKA CELLULO

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

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

Diversification Opportunities for SentinelOne and SVENSKA CELLULO

0.02

Correlation Coefficient

SentinelOne  SVENSKA CELLULO

Significant diversification

The 3 months correlation between SentinelOne and SVENSKA is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and SVENSKA CELLULO B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SVENSKA CELLULO B 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 SVENSKA CELLULO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SVENSKA CELLULO B has no effect on the direction of SentinelOne i.e., SentinelOne and SVENSKA CELLULO go up and down completely randomly.

Pair Corralation between SentinelOne and SVENSKA CELLULO

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the SVENSKA CELLULO. In addition to that, SentinelOne is 1.6 times more volatile than SVENSKA CELLULO B . It trades about -0.06 of its total potential returns per unit of risk. SVENSKA CELLULO B is currently generating about 0.01 per unit of volatility. If you would invest  1,239  in SVENSKA CELLULO B on October 23, 2024 and sell it today you would earn a total of  3.00  from holding SVENSKA CELLULO B or generate 0.24% return on investment over 90 days.

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

SentinelOne  vs.  SVENSKA CELLULO B

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.

SVENSKA CELLULO B

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SVENSKA CELLULO B has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, SVENSKA CELLULO is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with SentinelOne and SVENSKA CELLULO

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

The idea behind SentinelOne and SVENSKA CELLULO B 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.