Correlation Between SentinelOne and Avepoint

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

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

Diversification Opportunities for SentinelOne and Avepoint

0.75

Correlation Coefficient

SentinelOne  Avepoint

Poor diversification

The 3 months correlation between SentinelOne and Avepoint is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding SentinelOne and Avepoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avepoint 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 Avepoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avepoint has no effect on the direction of SentinelOne i.e., SentinelOne and Avepoint go up and down completely randomly.

Pair Corralation between SentinelOne and Avepoint

Taking into account the 90-day investment horizon SentinelOne is expected to generate 1.57 times less return on investment than Avepoint. In addition to that, SentinelOne is 1.54 times more volatile than Avepoint. It trades about 0.05 of its total potential returns per unit of risk. Avepoint is currently generating about 0.13 per unit of volatility. If you would invest  459.00  in Avepoint on September 4, 2024 and sell it today you would earn a total of  1,332  from holding Avepoint or generate 290.2% return on investment over 90 days.

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

SentinelOne  vs.  Avepoint

SentinelOne

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SentinelOne are ranked lower than 9 (%) 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.

Avepoint

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Avepoint are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Avepoint unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SentinelOne and Avepoint

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

The idea behind SentinelOne and Avepoint 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.