Correlation Between Cemtrex and SentinelOne

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

By analyzing existing cross correlation between Cemtrex and SentinelOne, you can compare the effects of market volatilities on Cemtrex and SentinelOne 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 Cemtrex with a short position of SentinelOne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cemtrex and SentinelOne.

Diversification Opportunities for Cemtrex and SentinelOne

-0.8

Correlation Coefficient

Cemtrex  SentinelOne

Pay attention - limited upside

The 3 months correlation between Cemtrex and SentinelOne is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Cemtrex and SentinelOne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SentinelOne and Cemtrex 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 Cemtrex are associated (or correlated) with SentinelOne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SentinelOne has no effect on the direction of Cemtrex i.e., Cemtrex and SentinelOne go up and down completely randomly.

Pair Corralation between Cemtrex and SentinelOne

Given the investment horizon of 90 days Cemtrex is expected to under-perform the SentinelOne. In addition to that, Cemtrex is 5.24 times more volatile than SentinelOne. It trades about -0.44 of its total potential returns per unit of risk. SentinelOne is currently generating about 0.14 per unit of volatility. If you would invest  2,288  in SentinelOne on September 1, 2024 and sell it today you would earn a total of  507.00  from holding SentinelOne or generate 22.16% return on investment over 90 days.

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

Cemtrex  vs.  SentinelOne

Cemtrex

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cemtrex has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

SentinelOne

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SentinelOne are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, SentinelOne unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cemtrex and SentinelOne

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

The idea behind Cemtrex and SentinelOne 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.