Correlation Between SentinelOne and 11880 Solutions

Can any of the company-specific risk be diversified away by investing in both SentinelOne and 11880 Solutions 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 11880 Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SentinelOne and 11880 Solutions AG, you can compare the effects of market volatilities on SentinelOne and 11880 Solutions 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 11880 Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of SentinelOne and 11880 Solutions.

Diversification Opportunities for SentinelOne and 11880 Solutions

0.59

Correlation Coefficient

SentinelOne  11880 Solutions

Very weak diversification

The 3 months correlation between SentinelOne and 11880 is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and 11880 Solutions AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 11880 Solutions AG 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 11880 Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 11880 Solutions AG has no effect on the direction of SentinelOne i.e., SentinelOne and 11880 Solutions go up and down completely randomly.

Pair Corralation between SentinelOne and 11880 Solutions

Taking into account the 90-day investment horizon SentinelOne is expected to under-perform the 11880 Solutions. But the stock apears to be less risky and, when comparing its historical volatility, SentinelOne is 2.34 times less risky than 11880 Solutions. The stock trades about -0.1 of its potential returns per unit of risk. The 11880 Solutions AG is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  80.00  in 11880 Solutions AG on December 22, 2024 and sell it today you would lose (16.00) from holding 11880 Solutions AG or give up 20.0% of portfolio value over 90 days.

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

SentinelOne  vs.  11880 Solutions AG

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.

11880 Solutions AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days 11880 Solutions AG has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with SentinelOne and 11880 Solutions

The main advantage of trading using opposite SentinelOne and 11880 Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SentinelOne position performs unexpectedly, 11880 Solutions 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 11880 Solutions will offset losses from the drop in 11880 Solutions' long position.

The idea behind SentinelOne and 11880 Solutions AG 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.